WT
WisdomTree, Inc.
$19.08
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 61.2% above fair value
You pay
$19.08
Bear
$8.28
Fair
$11.84
Bull
$15.39
Bear
$8.28
-56.6%
ROTCE 19.8% → 2.41x TBV
Fair
$11.84
-38.0%
ROTCE 25.0% → 3.42x TBV
Bull
$15.39
-19.4%
ROTCE 30.0% → 3.98x TBV
Key Value Driver
ROTCE (26.4%) vs. cost of equity (10.5%)
Implied Market Multiple
7.05x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $18.96 from 17 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $11.84 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 $18.96 (from 17 analysts). Our estimate is 50% below 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