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Here's Why You Should Buy SVB Financial (SIVB) Right Now
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Over the last few weeks, banking stocks have been witnessing an upward momentum, driven by improved earnings. Further, with Donald Trump elected to be the President, the banks expect lesser regulations. Also, chances of a rate hike in December are quite high.
Therefore, this a good time to add a few banking stocks in your portfolio. Today, we bring one such stock – SVB Financial Group – that continues to depict strong fundamentals and improving prospects.
In third-quarter 2016, SVB Financial’s earnings surpassed the Zacks Consensus Estimate. Moreover, it has witnessed an upward earnings estimate revision of 4.5% for 2016 over the past 30 days, indicating analysts’ optimism about its growth prospects.
Further, this Zacks Rank #2 (Buy) stock has risen nearly 22% year to date and has recorded an impressive earnings surprise history. You can see that in the chart below:
Revenue Strength: SVB Financial’s net revenue has risen at a compounded annual growth rate (“CAGR”) of 15.8% over the last four years (2012–2015). The sturdy top-line increase was backed by strong loan and deposit growth. Additionally, the company’s projected sales growth (F1/F0) of 4.4% ensures continuation of the upward revenue trend.
Earnings per Share Growth: SVB Financial has witnessed approximately 10.7% rise in earnings per share over the last three–five years. Further, this earnings momentum will likely continue in the near term, as reflected by the company’s projected EPS growth (F1/F0) of 8%.
Also, the company’s long-term (3–5 years) estimated EPS growth rate of 11.0% (versus the industry growth rate of 9.5%) promises rewards for investors in the long run.
Superior ROE: SVB Financial’s Return on Equity (ROE) ratio is 10.25% compared with industry average of 9.24%. This indicates that the company reinvests more efficiently as compared with industry.
Other Stocks Worth a Look
Other stocks worth considering in the financial sector include Farmers Capital Bank Corporation , Carolina Financial Corporation and Ameris Bancorp (ABCB - Free Report) .
Farmers Capital witnessed an upward earnings estimate revision of 8.3% over the past 30 days. Also, its share price is up nearly 22% year to date. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carolina Financial also sports a Zacks Rank #1 and has witnessed an upward earnings estimate revision of 12.9% over the past 30 days. Moreover, its share price is up nearly 39% year to date.
Ameris Bancorp currently carries a Zacks Rank #2. It has witnessed an upward earnings estimate revision of 1.3% over the past 30 days and its share price has risen over 25% year to date.
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Here's Why You Should Buy SVB Financial (SIVB) Right Now
Over the last few weeks, banking stocks have been witnessing an upward momentum, driven by improved earnings. Further, with Donald Trump elected to be the President, the banks expect lesser regulations. Also, chances of a rate hike in December are quite high.
Therefore, this a good time to add a few banking stocks in your portfolio. Today, we bring one such stock – SVB Financial Group – that continues to depict strong fundamentals and improving prospects.
In third-quarter 2016, SVB Financial’s earnings surpassed the Zacks Consensus Estimate. Moreover, it has witnessed an upward earnings estimate revision of 4.5% for 2016 over the past 30 days, indicating analysts’ optimism about its growth prospects.
Further, this Zacks Rank #2 (Buy) stock has risen nearly 22% year to date and has recorded an impressive earnings surprise history. You can see that in the chart below:
SVB FINL GP Price and EPS Surprise
SVB FINL GP Price and EPS Surprise | SVB FINL GP Quote
Why an Attractive Choice?
Revenue Strength: SVB Financial’s net revenue has risen at a compounded annual growth rate (“CAGR”) of 15.8% over the last four years (2012–2015). The sturdy top-line increase was backed by strong loan and deposit growth. Additionally, the company’s projected sales growth (F1/F0) of 4.4% ensures continuation of the upward revenue trend.
Earnings per Share Growth: SVB Financial has witnessed approximately 10.7% rise in earnings per share over the last three–five years. Further, this earnings momentum will likely continue in the near term, as reflected by the company’s projected EPS growth (F1/F0) of 8%.
Also, the company’s long-term (3–5 years) estimated EPS growth rate of 11.0% (versus the industry growth rate of 9.5%) promises rewards for investors in the long run.
Superior ROE: SVB Financial’s Return on Equity (ROE) ratio is 10.25% compared with industry average of 9.24%. This indicates that the company reinvests more efficiently as compared with industry.
Other Stocks Worth a Look
Other stocks worth considering in the financial sector include Farmers Capital Bank Corporation , Carolina Financial Corporation and Ameris Bancorp (ABCB - Free Report) .
Farmers Capital witnessed an upward earnings estimate revision of 8.3% over the past 30 days. Also, its share price is up nearly 22% year to date. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carolina Financial also sports a Zacks Rank #1 and has witnessed an upward earnings estimate revision of 12.9% over the past 30 days. Moreover, its share price is up nearly 39% year to date.
Ameris Bancorp currently carries a Zacks Rank #2. It has witnessed an upward earnings estimate revision of 1.3% over the past 30 days and its share price has risen over 25% year to date.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>