VRTS
Virtus Investment Partners, Inc.
$160.21
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 59.5% below fair value
You pay
$160.21
Bear
$277.18
Fair
$395.97
Bull
$514.76
Bear
$277.18
+73.0%
ROTCE 20.0% → 2.06x TBV
Fair
$395.97
+147.2%
ROTCE 25.0% → 4.00x TBV
Bull
$514.76
+221.3%
ROTCE 30.0% → 3.35x TBV
Key Value Driver
ROTCE (66.0%) vs. cost of equity (11.8%)
Implied Market Multiple
5.11x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $138.00 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $395.97 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.
Wall Street's average price target is $138.00 (from 11 analysts). Our estimate is 234% 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