AlphaMadera's AlphaVal page computes Velocity Financial, Inc.'s fair value using a multi-method blend (DCF, comparable-multiples, and Graham-style intrinsic value), then compares it to the current market price to flag VEL as undervalued, fairly valued, or overvalued.

What is Velocity Financial, Inc.'s fair value?

Fair value for VEL is a model output combining discounted cash flow projections, peer-group multiples, and a Graham number floor. The live AlphaVal page shows the blended fair value alongside each method's individual estimate.

How does AlphaMadera value VEL?

AlphaVal uses three primary techniques: a five-year discounted-cash-flow projection with terminal multiple, peer-group multiple analysis (P/E, EV/EBITDA, P/S), and Graham's defensive-investor intrinsic-value formula. Inputs come from VEL's most recent reported fundamentals.

VEL - Velocity Financial, Inc.

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $22.00 DETAILS

AlphaVal

Deterministic, archetype-aware fair value

Banks, Insurers & Asset Managers 90% confidence

Primary model: P/Tangible Book × ROE Quality

Valuation Signal Undervalued Strong

Trading 60.3% below fair value

Current Price $17.25

Bear Case $28.98 68.0% upside ($28.98 - $17.25) / $17.25 = 68.0% ROTCE 12.1% → 1.96x TBV

Fair Value $43.42 151.7% upside ($43.42 - $17.25) / $17.25 = 151.7% ROTCE 16.1% → 2.93x TBV

Bull Case $52.09 202.0% upside ($52.09 - $17.25) / $17.25 = 202.0% ROTCE 18.5% → 3.52x TBV

Adjust Assumptions

Return on Tangible Equity

16.1%

Cost of Equity

8.1%

Key Value Driver

ROTCE (16.1%) vs. cost of equity (8.1%)

Implied Market Multiple 1.04x

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 $22.00 from 7 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $43.42 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.

ℹ Wall Street's average price target is $22.00 (from 7 analysts). Our estimate is 122% above the consensus -- consider that gap carefully.

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