Valuing Deutsche Bank in October 2016
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NameDate of valuationCost of equity in year 10ROE in year 10Tier 1 Capital Ratio in year 10Probability of Equity WipeoutValue Per SharePrice per share% Under or Over Value
Crowd Median
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Aswath Damodaran10/4/20169.44%9.44%15.67%10%$20.67$13.33-35.51%-29.03%
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Ammar Jilani10/7/20169.44%10%15.67%10%$27.22$13.53-50.29%
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Mirek Jasiński10/8/20169.44%0.01%50%
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Jan10/7/201610.20%10.20%15.67%25%$17.24$13.50-21.69%
@Aswath, you didn't compared it to the Commerzbank bailout in Germany, which is a good comparison on how Germany did it in the past
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Nick10/7/20169.44%9.44%12.96%5%$23.54$13.50-42.65%
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Mauricio10/7/20169.44%7.00%15.67%10%$13.14$13.502.74%
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Mattia10/7/20169.44%9.44%12.96%10%$20.87$13.50-35.31%
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Tobias Classen10/7/20169.44%9.44%15.67%20%$19.65$13.50-31.30%
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Filippo Pasini10/10/20168.00%9.44%15.67%30%$10.98$13.5022.95%
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Kemi Akinde10/11/20169.44%9.44%15.67%10%$17.43$12.46-28.51%
Used 4 years instead of 3 for the interpolation of the expected ROE btw Current and Yr 5, price @ 5:03 AM EDT 10/11/2016 was 12.46
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Mike10/13/20169.44%7.00%15.67%10%$11.32$12.036.27%
target ROE in year 3 at 2.67% and 7% in year 10 and perpetuity, cost of equity dropping from 10.20% in year 4
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Javi10/14/201610.20%5.60%13.74%15%$11.32$12.318.75%
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Yen10/16/20169.21%9.0%12.46%15.81%$19.99$13.45-32.72%
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Krys10/18/20169.44%9.44%15.67%10%$17.27$13.45-22.12%
Current CoE due to DB set at 15% (I see DB being priced more as Lehman then a regular going concern bank)
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Benson10/18/20169.11%11.54%16.33%30%EUR18.83EUR12.32-52.84%
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Moritz11/6/201610.20%7.50%15.67%10%EUR17.17EUR12.1-29.54%
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eee$18.28$13.29-27.26%
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Ashrit Kasshyap1/21/179.44%9.44%15.67%10%$22.07$19.18-13.09%
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Oliver Wilkinson2/5/20179.44%9.44%15.67%5%$37.42$20.23-45.94%
Just adjust Aswath's FCFE estimates from Year 1~4 to 0 (I think they are too pessimistic), with the 2016 number already known, and the result gets much more positive. And I do not think DB has a bailout risk now since its most dangerous time has passed. Even put a 10% probability of bailout, the value per share is still much more than its current price, just back to the its level in mid-2015.
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