TRUP
Trupanion, Inc.
$31.76
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 1341.1% above fair value
You pay
$31.76
Bear
$2.20
Fair
$2.20
Bull
$2.68
Bear
$2.20
-93.1%
ROTCE 4.5% → 0.30x TBV
Fair
$2.20
-93.1%
ROTCE 6.1% → 0.30x TBV
Bull
$2.68
-91.6%
ROTCE 7.0% → 0.36x TBV
Adjust Assumptions
6.1%
12.2%
Key Value Driver
ROTCE (6.1%) vs. cost of equity (12.2%)
Implied Market Multiple
4.32x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (15 analysts)
$35.00
Divergence from AlphaVal
94%
Summary
With ROTCE of 6.1% vs. 12.2% cost of equity, fair P/TBV is 0.30x on $7.35 tangible book, implying $2.20 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.
Return on equity (6.1%) is below the minimum investors require (12.2%). This means the bank is worth less than the net assets on its books.
Wall Street's average price target is $35.00 (from 15 analysts). Our estimate is 94% below 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