Farmers & Merchants Bancorp, Inc. logo FMAO - Farmers & Merchants Bancorp, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS
STRONG
BUY 0
BUY 0
HOLD 2
SELL 0
STRONG
SELL 0
| PRICE TARGET: $28.50 DETAILS
HIGH: $28.50
LOW: $28.50
MEDIAN: $28.50
CONSENSUS: $28.50
UPSIDE: 3.49%
AlphaVal

AlphaVal

Deterministic, archetype-aware fair value

Banks, Insurers & Asset Managers 85% confidence

Primary model: P/Tangible Book × ROE Quality

Valuation Signal Fair Value Moderate
Trading 17.1% below fair value
Current Price $27.54
Bear Case $20.73 24.7% downside ($20.73 - $27.54) / $27.54 = -24.7% ROTCE 8.9% → 1.02x TBV
Fair Value $33.24 20.7% upside ($33.24 - $27.54) / $27.54 = 20.7% ROTCE 11.9% → 1.64x TBV
Bull Case $40.74 47.9% upside ($40.74 - $27.54) / $27.54 = 47.9% ROTCE 13.7% → 2.01x TBV

Adjust Assumptions

11.9%
8.8%

Key Value Driver

ROTCE (11.9%) vs. cost of equity (8.8%)

Implied Market Multiple 1.36x

Plain-Language Summary

With ROTCE of 11.9% vs. 8.8% cost of equity, fair P/TBV is 1.64x on $20.29 tangible book, implying $33.24 per share. DDM cross-check: $21.78.

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: $21.78 (34% 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