UVSP
Univest Financial Corporation
$39.30
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 22.9% below fair value
You pay
$39.30
Bear
$31.80
Fair
$50.97
Bull
$62.47
Bear
$31.80
-19.1%
ROTCE 9.0% → 1.26x TBV
Fair
$50.97
+29.7%
ROTCE 11.9% → 2.02x TBV
Bull
$62.47
+59.0%
ROTCE 13.7% → 2.48x TBV
Key Value Driver
ROTCE (11.9%) vs. cost of equity (7.9%)
Implied Market Multiple
1.44x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $34.00 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $50.97 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: $15.06 (73% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $34.00 (from 6 analysts). Our estimate is 62% 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