WT
WisdomTree, Inc.
$24.89
Banks, Insurers & Asset Managers
90%
P/Tangible Book × ROE Quality
Strong
·
Conviction
Overvalued
Trading 190.1% above fair value
You pay
$24.89
Bear
$6.18
Fair
$8.58
Bull
$11.15
Bear
$6.18
-75.2%
ROTCE 19.8% → 2.28x TBV
Fair
$8.58
-65.5%
ROTCE 25.0% → 3.04x TBV
Bull
$11.15
-55.2%
ROTCE 30.0% → 3.76x TBV
Adjust Assumptions
26.4%
10.9%
Key Value Driver
ROTCE (26.4%) vs. cost of equity (10.9%)
Implied Market Multiple
9.2x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (17 analysts)
$23.66
Divergence from AlphaVal
64%
Summary
With ROTCE of 26.4% vs. 10.9% cost of equity, fair P/TBV is 3.04x on $2.70 tangible book, implying $8.58 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 $23.66 (from 17 analysts). Our estimate is 64% 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