WTW
Willis Towers Watson Public Limited Company
$295.11
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Mild
·
Conviction
Fair Value
Trading 12.7% below fair value
Bear
$338.20
+14.6%
ROTCE 15.1% → 4.00x TBV
Fair
$338.20
+14.6%
ROTCE 20.1% → 4.00x TBV
Bull
$338.20
+14.6%
ROTCE 23.1% → 4.00x TBV
Key Value Driver
ROTCE (20.1%) vs. cost of equity (6.7%)
Implied Market Multiple
3.49x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $339.42 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $338.20 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: $104.58 (69% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
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