Arrow Financial Corporation logo AROW - Arrow Financial Corporation

Price: -- -- | CONSENSUS: Hold DETAILS
STRONG
BUY 0
BUY 0
HOLD 1
SELL 0
STRONG
SELL 0
| PRICE TARGET: $30.00 DETAILS
HIGH: $30.00
LOW: $30.00
MEDIAN: $30.00
CONSENSUS: $30.00
DOWNSIDE: 18.52%
AlphaVal

AlphaVal

Deterministic, archetype-aware fair value

Banks, Insurers & Asset Managers 85% confidence

Primary model: P/Tangible Book × ROE Quality

Valuation Signal Fair Value Mild
Trading 7.4% below fair value
Current Price $36.82
Bear Case $27.82 24.4% downside ($27.82 - $36.82) / $36.82 = -24.4% ROTCE 8.1% → 0.91x TBV
Fair Value $39.75 8.0% upside ($39.75 - $36.82) / $36.82 = 8.0% ROTCE 10.8% → 1.50x TBV
Bull Case $51.68 40.3% upside ($51.68 - $36.82) / $36.82 = 40.3% ROTCE 12.4% → 1.86x TBV

Adjust Assumptions

10.8%
8.5%

Key Value Driver

ROTCE (10.8%) vs. cost of equity (8.5%)

Implied Market Multiple 1.5x

Plain-Language Summary

With ROTCE of 10.8% vs. 8.5% cost of equity, fair P/TBV is 1.50x on $24.58 tangible book, implying $39.75 per share. DDM cross-check: $18.94.

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.
ℹ Dividend-based valuation: $18.94 (52% 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