PRA - ProAssurance Corporation
Price:
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CONSENSUS:
Hold
DETAILS
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PRICE TARGET:
$18.33
DETAILS
HIGH:
$20.00
LOW:
$17.00
MEDIAN:
$18.00
CONSENSUS:
$18.33
DOWNSIDE:
25.55%
AlphaVal
Deterministic, archetype-aware fair value
Banks, Insurers & Asset Managers
85% confidence
Primary model: P/Tangible Book × ROE Quality
Adjust Assumptions
4.1%
6.0%
Key Value Driver
ROTCE (4.1%) vs. cost of equity (6.0%)
Implied Market Multiple
1.03x
Plain-Language Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $18.33 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $18.20 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 (4.1%) is below the minimum investors require (6.0%). 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