TPG
TPG Inc.
$43.24
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 72.6% below fair value
You pay
$43.24
Bear
$110.42
Fair
$157.74
Bull
$205.06
Bear
$110.42
+155.4%
ROTCE 20.0% → 1.90x TBV
Fair
$157.74
+264.8%
ROTCE 25.0% → 2.50x TBV
Bull
$205.06
+374.3%
ROTCE 30.0% → 3.09x TBV
Adjust Assumptions
678.9%
12.4%
Key Value Driver
ROTCE (678.9%) vs. cost of equity (12.4%)
Implied Market Multiple
609.56x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (18 analysts)
$57.11
Divergence from AlphaVal
176%
Summary
With ROTCE of 678.9% vs. 12.4% cost of equity, fair P/TBV is 2.50x on $0.07 tangible book, implying $157.74 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 $57.11 (from 18 analysts). Our estimate is 176% 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