Employers Holdings, Inc. logo EIG - Employers Holdings, Inc.

Price: -- -- | CONSENSUS: Buy DETAILS
STRONG
BUY 0
BUY 4
HOLD 3
SELL 1
STRONG
SELL 0
AlphaVal

AlphaVal

Deterministic, archetype-aware fair value

Banks, Insurers & Asset Managers 85% confidence

Primary model: P/Tangible Book × ROE Quality

Valuation Signal Undervalued Moderate
Trading 29.8% below fair value
Current Price $43.90
Bear Case $43.78 0.3% downside ($43.78 - $43.90) / $43.90 = -0.3% ROTCE 4.0% → 0.30x TBV
Fair Value $62.55 42.5% upside ($62.55 - $43.90) / $43.90 = 42.5% ROTCE 1.3% → 0.30x TBV
Bull Case $81.31 85.2% upside ($81.31 - $43.90) / $43.90 = 85.2% ROTCE 1.5% → 0.30x TBV

Adjust Assumptions

1.3%
7.0%

Key Value Driver

ROTCE (1.3%) vs. cost of equity (7.0%)

Implied Market Multiple 1.14x

Plain-Language Summary

With ROTCE of 1.3% vs. 7.0% cost of equity, fair P/TBV is 0.30x on $38.36 tangible book, implying $62.55 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.
⚠ Return on equity (1.3%) is below the minimum investors require (7.0%). This means the bank is worth less than the net assets on its books.

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