WCCB
West Coast Community Bancorp
$61.54
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Undervalued
Trading 48.3% below fair value
You pay
$61.54
Bear
$81.26
Fair
$119.05
Bull
$119.05
Bear
$81.26
+32.0%
ROTCE 12.1% → 2.73x TBV
Fair
$119.05
+93.5%
ROTCE 16.1% → 4.00x TBV
Bull
$119.05
+93.5%
ROTCE 18.5% → 4.00x TBV
Adjust Assumptions
16.1%
7.0%
Key Value Driver
ROTCE (16.1%) vs. cost of equity (7.0%)
Implied Market Multiple
2.07x
Summary
With ROTCE of 16.1% vs. 7.0% cost of equity, fair P/TBV is 4.00x on $29.76 tangible book, implying $119.05 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