1st Source Corporation logo SRCE - 1st Source Corporation

Price: -- -- | CONSENSUS: Hold DETAILS
STRONG
BUY 0
BUY 1
HOLD 3
SELL 0
STRONG
SELL 0
| PRICE TARGET: $81.00 DETAILS
HIGH: $88.00
LOW: $74.00
MEDIAN: $81.00
CONSENSUS: $81.00
UPSIDE: 9.53%
AlphaVal

AlphaVal

Deterministic, archetype-aware fair value

Banks, Insurers & Asset Managers 85% confidence

Primary model: P/Tangible Book × ROE Quality

Valuation Signal Undervalued Strong
Trading 43.3% below fair value
Current Price $73.95
Bear Case $83.80 13.3% upside ($83.80 - $73.95) / $73.95 = 13.3% ROTCE 10.0% → 1.69x TBV
Fair Value $130.47 76.4% upside ($130.47 - $73.95) / $73.95 = 76.4% ROTCE 13.3% → 2.64x TBV
Bull Case $158.47 114.3% upside ($158.47 - $73.95) / $73.95 = 114.3% ROTCE 15.3% → 3.20x TBV

Adjust Assumptions

13.3%
7.5%

Key Value Driver

ROTCE (13.3%) vs. cost of equity (7.5%)

Implied Market Multiple 1.49x

Plain-Language Summary

With ROTCE of 13.3% vs. 7.5% cost of equity, fair P/TBV is 2.64x on $49.49 tangible book, implying $130.47 per share. DDM cross-check: $78.47.

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: $78.47 (40% 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