TW
Tradeweb Markets Inc.
$109.68
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 146.7% above fair value
You pay
$109.68
Bear
$41.52
Fair
$44.46
Bull
$57.80
Bear
$41.52
-62.1%
ROTCE 20.0% → 4.00x TBV
Fair
$44.46
-59.5%
ROTCE 25.0% → 4.00x TBV
Bull
$57.80
-47.3%
ROTCE 30.0% → 4.00x TBV
Adjust Assumptions
36.8%
7.7%
Key Value Driver
ROTCE (36.8%) vs. cost of equity (7.7%)
Implied Market Multiple
10.57x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (28 analysts)
$120.86
Divergence from AlphaVal
63%
Summary
With ROTCE of 36.8% vs. 7.7% cost of equity, fair P/TBV is 4.00x on $10.38 tangible book, implying $44.46 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 $120.86 (from 28 analysts). Our estimate is 63% 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