TPG
TPG Inc.
$41.62
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 71.0% below fair value
You pay
$41.62
Bear
$100.34
Fair
$143.34
Bull
$186.34
Bear
$100.34
+141.1%
ROTCE 20.0% → 1.92x TBV
Fair
$143.34
+244.4%
ROTCE 25.0% → 4.00x TBV
Bull
$186.34
+347.7%
ROTCE 30.0% → 3.12x TBV
Key Value Driver
ROTCE (678.9%) vs. cost of equity (12.3%)
Implied Market Multiple
586.78x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $59.88 from 17 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $143.34 per share.
Warnings
Traditional cash flow models don't work well for banks — lending activity distorts how much cash the business actually generates.
Common valuation shortcuts don't apply here — for banks, interest payments are a core business cost, not overhead.
Wall Street's average price target is $59.88 (from 17 analysts). Our estimate is 186% above the consensus -- consider that gap carefully.
Key Risks
- Book value quality matters as much as level — check loan loss reserves
- Interest rate sensitivity creates non-linear earnings surprises
- Insurance reserving is actuarial, not financial — errors emerge slowly