UBS
UBS Group AG
$52.03
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 95.9% above fair value
You pay
$52.03
Bear
$14.78
Fair
$26.55
Bull
$33.62
Bear
$14.78
-71.6%
ROTCE 6.9% → 0.59x TBV
Fair
$26.55
-49.0%
ROTCE 9.2% → 1.07x TBV
Bull
$33.62
-35.4%
ROTCE 10.5% → 1.35x TBV
Key Value Driver
ROTCE (9.2%) vs. cost of equity (8.8%)
Implied Market Multiple
2.01x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $23.57 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $26.55 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.
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