Are BOQ shares worth considering in November?

Core Insights - The share price of Bank of Queensland Limited (BOQ) is under scrutiny as ASX investors attempt to establish a rough valuation for the company [1][2] - The valuation of bank shares, including BOQ, can be approached through various methods such as the Price-to-Earnings (PE) ratio and the Dividend Discount Model (DDM) [3][6] Valuation Methods - The PE ratio is a key metric that compares a company's share price to its earnings per share, with a current PE ratio for BOQ calculated at 16.7x, compared to the banking sector average of 20x [5] - A sector-adjusted PE valuation for BOQ, based on its earnings per share of $0.41, results in a valuation of $8.08 [5] - The DDM is a more robust valuation method, which uses the most recent full-year dividends and assumes consistent or growing dividends over time [7][8] Dividend Valuation - Using a DDM approach, the valuation of BOQ shares is estimated at $7.19, with an adjusted dividend payment leading to a valuation of $7.40, compared to the current share price of $6.86 [10] - Considering fully franked dividends, the valuation based on a forecast gross dividend payment of $0.50 results in a share price valuation of $10.57 [11] Growth and Risk Analysis - A range of growth rates (2% to 4%) and risk rates (6% to 11%) were analyzed, yielding various share price valuations, with the highest valuation at $17.50 under a 4% growth rate and 2% risk rate [12] - The analysis emphasizes the importance of assessing net interest margins, regulatory impacts, and management culture when evaluating bank shares like BOQ [13]