Citizens & Northern Corporation

AI-generated fair value estimate for this company.

Method: Bank excess-return (Gordon growth on ROE) valuation: book value of $19.29/share; return on equity of 7.31% ($25.27M net income / ~$345.6M total equity implied by book value x shares outstanding); 9% cost of equity; 3% sustainable growth. Justified P/B = (0.0731-0.03)/(0.09-0.03) = 0.72x; intrinsic value = 0.72 x $19.29 = $13.86/share.

Reasoning: As a bank, CZNC is valued on its return on equity relative to its cost of equity rather than unlevered FCF; its ROE of ~7.3% is modest relative to a 9% required return, which under a standard excess-return bank model implies a sub-1x price-to-book multiple, below the market's current ~1.33x P/B, suggesting the market is pricing in franchise value (long operating history since 1864, stable deposit base) beyond what current ROE alone supports.