WTW
Willis Towers Watson Public Limited Company
$257.40
Banks, Insurers & Asset Managers
85%
P/Tangible Book × ROE Quality
Moderate
·
Conviction
Fair Value
Trading 23.8% below fair value
You pay
$257.40
Bear
$335.46
Fair
$337.69
Bull
$337.69
Bear
$335.46
+30.3%
ROTCE 15.1% → 3.97x TBV
Fair
$337.69
+31.2%
ROTCE 20.1% → 4.00x TBV
Bull
$337.69
+31.2%
ROTCE 23.1% → 4.00x TBV
Key Value Driver
ROTCE (20.1%) vs. cost of equity (6.8%)
Implied Market Multiple
3.05x
Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $337.38 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $337.69 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: $102.75 (70% 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