National Bank Holdings Corp (NBHC): what the price requires
At today's price, National Bank Holdings Corp (NBHC) is priced for 10.8% return on equity. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-17 · Source: https://boothcheck.com/report/NBHC
Headline
| Field | Value |
|---|---|
| Ticker | NBHC |
| Company | National Bank Holdings Corp |
| Current price | $44.73/sh |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | financials |
| Return on equity needed | 10.8% |
| Return on equity now | 7.9% |
| ROE gap | +2.9pp |
| Price-to-book | 1.20x |
Solve inputs: computed at a 9.7% cost of equity with 4% terminal growth over a 5-year stage, on common book equity (FY2026); each 1pp of cost of equity moves the implied ROE ~1.2pp.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | +1.27σ |
| cohort percentile (of 119 peers) | 29 |
| sustained it ~10 years at this level | 73% |
| implied end-window share | 0% |
Valuation X-Ray
Every valuation family lands below the price. The price therefore requires assumptions beyond what those standard frames encode.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 1.74x | 3 | expensive |
| Earnings | 10.71x | 2 | expensive |
| Relative | 1.39x | 1 | expensive |
| Growth | 1.35x | 3 | expensive |
Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.8%); the inversion above states its own rate.
Per-Model Detail (n=9)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | — | — | no | — |
| Bank Fair Value (P/TBV) | — | $11.98 | 3.73x | yes | TBVPS $25.62 × 0.47x (ROE (TTM) 6.4% / CoE 9.3%, g=4.1% (sustainable: 65% retention × ROE, 5% cap; not the terminal-growth assumption), credit 1.19% allowance/loans → ×0.94) |
| Relative Valuation | Relative | $32.11 | 1.39x | yes | P/E 12.64x (blended: static sector reference 10x + trailing (TTM) 19x), scenarios: 10.5x / 12.6x / 14.7x (bear / base = reference held flat / bull), EV/EBITDA N/Ax |
| Simple DDM | Growth | $48.91 | 0.91x | yes | DPS $1.32, g=6.4% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $14.10 | 3.17x | yes | Stage 1: -8% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $25.72 | 1.74x | yes | BV/sh $37.32, ROE (TTM) 6.4%, ke 9.3% |
| Two-Stage Excess Return | Asset | $20.98 | 2.13x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $33.17 | 1.35x | yes | Rev $0.4B, growth 7% (input: historical growth; tapered), Terminal P/S: 4.5x / 5.4x / 6.3x (bear / base = today's held flat / bull, cap 8x) |
| Growth-Adjusted P/E | Relative | — | — | no | — |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | — | — | no | — |
| Residual Income | Asset | — | — | no | — |
| Graham Number | Asset | $47.44 | 0.94x | yes | √(22.5 × EPS $2.68 × BVPS $37.32) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | — | — | no | — |
| FCF Yield | Earnings | — | — | no | — |
| SBC-Adj FCF Yield | Earnings | — | — | no | — |
| Ben Graham Formula | Earnings | $2.25 | 19.88x | yes | EPS $2.68 × (8.5 + 2×-5.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | — | — | no | — |
| P/Sales Sector | Relative | — | — | no | — |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | $28.97 | 1.54x | yes | EPS $2.68 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Share count CAGR (dilution) | 10.0% |
Deposit/float-funded balance sheet: debt is funding, not corporate leverage, and GAAP operating cash flow follows loan flows. Net-debt, interest-coverage, and cash-burn lenses do not apply. The solvency frame for a financial is regulatory capital and payout capacity (CET1, stress buffer, dividends plus buybacks against earnings).
Bullet Takeaways
National Bank Holdings is a Colorado-based regional bank, and a bank is worth the return it earns on its capital, so the price is read off book value rather than an operating multiple. At $42.67 the stock trades around 1.2x book, which implies the bank sustains a return on equity near 10.7%, against a recent run rate closer to 7.9% on the standard measure.
That gap is the whole story. The most recent quarter showed adjusted return on tangible common equity of 11.79% and a net interest margin of 4.06%, both well above the implied bar, helped by the just-closed Vista acquisition and record loan originations. The question is whether that elevated profitability holds or fades back toward the lower trailing level.
Capital allocation is active and shareholder-friendly: a new $100 million buyback authorization, $16.1 million repurchased in the quarter, and a dividend raised 3% to $0.32. The bank is deploying capital into both M&A and its own shares while loans grow at a double-digit annualized pace.
Bull Case
The cleanest way into the bull case is how the bank deploys its capital, because it signals where management sees value. In the most recent quarter National Bank Holdings authorized a $100 million share buyback and executed $16.1 million of it, raised the quarterly dividend 3% to $0.32, and closed the Vista acquisition on January 7, 2026, which added $1.9 billion in loans and $2.2 billion in deposits. A bank buying its own stock, lifting the payout, and completing a sizable deal in the same quarter is telling you management believes both the shares and the franchise are worth more than the market is paying, and it is putting capital behind all three uses at once.
The operating results support that confidence. Adjusted diluted EPS was $0.72 on net income of $20.8 million, adjusted return on tangible common equity reached 11.79%, and net interest margin expanded 17 basis points to 4.06%. The bank also posted record quarterly loan originations of $805 million, an annualized loan-growth pace of about 12.4%. Earning an 11.79% adjusted return on tangible equity while growing the loan book at double digits is the combination that justifies trading above book value, and it sits comfortably above the roughly 10.7% return the current price implies.
The deposit base is the structural advantage underneath the margin. The filing shows transaction deposits at 86.1% of total deposits at year-end 2025, and the cost of deposits improved 21 basis points to 2.02% over the year through disciplined pricing as rates fell (FY2025 10-K, accession 0001104659-26-019119). A funding base that heavy in low-cost transaction accounts is what lets a regional bank hold a 4% net interest margin, and it is the asset that makes the higher implied ROE achievable rather than aspirational.
Bear Case
The advantage that could be chipped away is the low-cost deposit franchise, and the data shows the first signs of pressure. The filing reports the mix of transaction deposits to total deposits slipped to 86.1% at year-end 2025 from 87.6% a year earlier (FY2025 10-K, accession 0001104659-26-019119). That is a small move, but the direction matters: as customers rotate from non-interest-bearing accounts into higher-yielding ones, the funding cost advantage that supports a 4% margin erodes at the edges. A bank's moat is its deposit base, and a deposit base that is gradually getting more expensive is a moat under slow attrition.
The second concern is the gap between the recent ROE and the longer trailing figure. The price implies a sustained return on equity near 10.7%, the latest quarter delivered an adjusted return on tangible common equity of 11.79%, but the broader trailing return has been closer to 7.9%, and the filing's own multi-year return figures swing across a wide range from the high single digits into the high teens. The elevated current profitability is partly the Vista acquisition and a record origination quarter, both of which can normalize. If the run rate settles back toward the lower end of that range, the stock is paying above book for a return that does not clear its cost of equity.
The acquisition itself is the integration risk. Vista added $1.9 billion of loans and $2.2 billion of deposits essentially overnight, and acquired loan books carry credit and integration uncertainty that does not show up until later quarters. The buyback was also reported by some observers as paused or reduced in the period, a sign management is balancing capital return against the need to absorb the deal and grow the balance sheet. The bear case is not a blow-up, it is mean reversion: a regional bank whose recent results flatter a longer-run return that the price has already extrapolated.
Valuation
A bank is valued on the return it earns on its capital, so the price is read off price-to-book, not an operating multiple. At today's $42.67 (June 27, 2026) the market is paying about 1.2x book and assuming the bank sustains a return on equity near 10.7%, against a recent run rate of about 7.9% on the standard measure. That solve runs at a cost of equity near 9.8% with 4% terminal growth on common book equity, and each point of cost of equity moves the implied ROE by roughly 1.2 points. Keep these figures approximate; they are a single inversion under fixed assumptions.
The assumption sits within range. The implied return is within reach of what the bank has earned in its better years, the price-to-book is in the lower half of the peer group, and the most recent quarter's adjusted return on tangible common equity of 11.79% actually exceeds the implied bar. Historically about 74% of firms earning this return sustained it for roughly a decade, which is a relatively favorable base rate. The read is a bank priced for a return it can plausibly deliver, not a stretch.
The tension the methods flag is the spread between the recent and the trailing return. The valuation case therefore turns on durability: if the post-Vista origination strength and the 4% margin hold, 1.2x book is reasonable; if the return fades toward the high single digits, the price is paying for a profitability the bank is not consistently producing.
Catalysts
The most recent event was the Q1 2026 report (April 2026): adjusted diluted EPS of $0.72, net income of $20.8 million, adjusted return on tangible common equity of 11.79%, and net interest margin of 4.06%, up 17 basis points from the prior quarter. The bank posted record quarterly loan originations of $805 million, an annualized loan-growth pace of about 12.4%. Some coverage framed the quarter as an earnings miss against expectations alongside a buyback pause, so the market reaction was mixed despite the strong margin and origination figures.
The defining recent transaction was the Vista acquisition, which closed January 7, 2026 and added $1.9 billion in loans and $2.2 billion in deposits. Integration of that book is the near-term operational catalyst: deposit retention, credit performance on the acquired loans, and cost synergies will show up over the next few quarters and determine whether the deal lifts or dilutes the return on equity.
Capital actions are the other catalyst stream: a $100 million buyback authorization with $16.1 million executed, and a dividend raised 3% to $0.32. The watch items are deposit-cost trends as the rate cycle evolves, the pace of buyback execution against the need to fund balance-sheet growth, and whether the post-deal margin holds near 4%. Continued double-digit loan growth with a stable margin would confirm the bull read; a step-down in either would point toward mean reversion. Sources: National Bank Holdings Q1 2026 results and earnings coverage (stocktitan.net; globenewswire.com; fool.com; simplywall.st), April 2026.
Peer Cohorts (Per Segment, With Filing Citations)
Community banking (reported)
- STEL (Stellar Bancorp, Inc.)
- (no filing in the citation store)
- EFSC (ENTERPRISE FINANCIAL SERVICES CORP)
- (no filing in the citation store)
- BY (BYLINE BANCORP, INC.)
- (no filing in the citation store)
- FSUN (FIRSTSUN CAPITAL BANCORP)
- (no filing in the citation store)
- SRCE (1st Source Corp)
- (no filing in the citation store)
- TCBK (TriCo Bancshares)
- (no filing in the citation store)
- FULT (FULTON FINANCIAL CORP)
- (no filing in the citation store)
- BANR (Banner Corporation)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.