UMBF
UMB Financial Corporation
$131.21
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 7.0% below fair value
You pay
$131.21
Bear
$90.28
Fair
$141.07
Bull
$171.54
Bear
$90.28
-31.2%
ROTCE 9.8% → 1.25x TBV
Fair
$141.07
+7.5%
ROTCE 13.1% → 1.95x TBV
Bull
$171.54
+30.7%
ROTCE 15.1% → 2.37x TBV
Key Value Driver
ROTCE (13.1%) vs. cost of equity (8.7%)
Implied Market Multiple
1.86x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $150.67 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $141.07 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.
Dividend-based valuation: $29.09 (79% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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