Is it cheap or expensive right now?

Latest price vs our fair value. A comparison, not a recommendation.

In plain terms: ADIB is the UAE’s most profitable bank — a 28.8% return on equity built on deposits that are 91% current-and-savings — and it is priced for it: 3.31× book against a sector at 1.55×. Five lenses put fair value at AED 17.9–23.5, with a weighted central of AED 21.23 — about 2.4% below the price. On the payout it has held for five straight years (48.5–49.9% of profit), the dividend model alone says AED 22.5; give it credit for the surplus capital a slowing growth rate frees up and the FCFE ceiling is AED 23.5. The crux is durability: at our cost of equity the price already implies a 26% return on equity forever, better than management’s own 25% 2030 target. The bull case (~AED 23) is that the moat is structural and holds; the conservative case (~AED 18) is what the sector actually pays for this return today. What moves it near-term is whether the Strait of Hormuz stays open and how the UAE’s new minimum tax lands.

Key levels

The 5th–95th and 25th–75th percentile bands from the 50,000-path simulation. Static and pre-computed — independent of the fundamental value.

What drives the odds

50,000 paths, 16 forces: the CBUAE/Fed rate path (the NIM driver), non-oil GDP & diversification credit demand, oil price & fiscal impulse, sector credit growth, dividend/payout signal, foreign (index-inclusion) flows, and momentum/mean-reversion tilt — plus event forces: a quarterly earnings surprise, a CBUAE policy surprise, a dividend declaration surprise, a sovereign rating action, a regulatory fee/levy change, a large corporate credit event, an index rebalance, an oil shock, and a geopolitical/regional event. Details in the methodology.