Nelnet, Inc. logo NNI - Nelnet, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS
STRONG
BUY 0
BUY 0
HOLD 3
SELL 0
STRONG
SELL 0
AlphaVal

AlphaVal

Deterministic, archetype-aware fair value

Banks, Insurers & Asset Managers 80% confidence

Primary model: P/Tangible Book × ROE Quality

Valuation Signal Fair Value Moderate
Trading 23.3% below fair value
Current Price $133.51
Bear Case $109.47 18.0% downside ($109.47 - $133.51) / $133.51 = -18.0% ROTCE 9.2% → 1.12x TBV
Fair Value $174.10 30.4% upside ($174.10 - $133.51) / $133.51 = 30.4% ROTCE 12.2% → 1.79x TBV
Bull Case $212.88 59.5% upside ($212.88 - $133.51) / $133.51 = 59.5% ROTCE 14.1% → 2.19x TBV

Adjust Assumptions

12.2%
8.6%

Key Value Driver

ROTCE (12.2%) vs. cost of equity (8.6%)

Implied Market Multiple 1.37x

Plain-Language Summary

With ROTCE of 12.2% vs. 8.6% cost of equity, fair P/TBV is 1.79x on $97.36 tangible book, implying $174.10 per share. DDM cross-check: $66.17.

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: $66.17 (62% 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