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SVB Financial (SIVB) Continues to Gain From Expansion Efforts
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SVB Financial’s global expansion strategy is expected to continue to support financials in the quarters ahead. Moreover, a strong balance sheet position along with efforts to improve non-interest income bodes well for the company.
Also, analysts are optimistic regarding SVB Financial’s earnings growth potential. The Zacks Consensus Estimate for its 2021 earnings has been revised upward by 3.8% over the past 30 days. Thus, the company currently sports a Zacks Rank #1 (Strong Buy).
Over the past six months, shares of SVB Financial have gained 111.1% compared with the industry's growth of 84.8%.
Looking at fundamentals, its net loans have witnessed a compound annual growth rate (“CAGR”) of 22.8% over the last five years (2016-2020). Also, net interest income and deposits witnessed a CAGR of 17% and 27.2%, respectively, over the same time frame.
Moreover, the company has been undertaking efforts to expand globally. While its U.K. and Asia operations seem to be growing, the businesses in Canada and Germany are expected to further boost revenues. International core fee income witnessed a five-year (ended 2020) CAGR of 27%.
Notably, the acquisition of SVB Leerink in 2019 continues to support financials. Also, in January 2021, SVB Financial inked a deal to acquire Boston Private, which is expected to further strengthen its private bank and wealth-management offerings. These deals along with the acquisition of the debt-investment business of WestRiver Group in December 2020 are expected to support its position as one of the foremost providers of financing solutions to innovative companies.
Further, SVB Financial boasts a solid balance sheet. Its current liquidity position seems sufficient to help it meet debt obligations in the near term, even if the economic situation worsens.
However, near-zero interest rates are likely to continue putting pressure on the company’s net interest margin in the near term. Also, elevated operating expenses might hurt the bottom line to an extent.
Other Stocks to Consider
Hope Bancorp, Inc. (HOPE - Free Report) has witnessed an upward earnings estimate revision of 26.2% for 2021 over the past 60 days. Its shares have gained 90.2% over the past six months. The company currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Blackstone Group Inc.’s (BX - Free Report) 2021 earnings estimates have increased 9.7% over the past 60 days. The company’s shares have gained 34.3% over the past six months. At present, it carries a Zacks Rank #2 (Buy).
The Goldman Sachs Group, Inc. (GS - Free Report) has witnessed an upward earnings estimate revision of 15.6% for the current year over the past 60 days. It currently carries a Zacks Rank of 2. The stock has gained 69.8% over the past six months.
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SVB Financial (SIVB) Continues to Gain From Expansion Efforts
SVB Financial’s global expansion strategy is expected to continue to support financials in the quarters ahead. Moreover, a strong balance sheet position along with efforts to improve non-interest income bodes well for the company.
Also, analysts are optimistic regarding SVB Financial’s earnings growth potential. The Zacks Consensus Estimate for its 2021 earnings has been revised upward by 3.8% over the past 30 days. Thus, the company currently sports a Zacks Rank #1 (Strong Buy).
Over the past six months, shares of SVB Financial have gained 111.1% compared with the industry's growth of 84.8%.
Looking at fundamentals, its net loans have witnessed a compound annual growth rate (“CAGR”) of 22.8% over the last five years (2016-2020). Also, net interest income and deposits witnessed a CAGR of 17% and 27.2%, respectively, over the same time frame.
Moreover, the company has been undertaking efforts to expand globally. While its U.K. and Asia operations seem to be growing, the businesses in Canada and Germany are expected to further boost revenues. International core fee income witnessed a five-year (ended 2020) CAGR of 27%.
Notably, the acquisition of SVB Leerink in 2019 continues to support financials. Also, in January 2021, SVB Financial inked a deal to acquire Boston Private, which is expected to further strengthen its private bank and wealth-management offerings. These deals along with the acquisition of the debt-investment business of WestRiver Group in December 2020 are expected to support its position as one of the foremost providers of financing solutions to innovative companies.
Further, SVB Financial boasts a solid balance sheet. Its current liquidity position seems sufficient to help it meet debt obligations in the near term, even if the economic situation worsens.
However, near-zero interest rates are likely to continue putting pressure on the company’s net interest margin in the near term. Also, elevated operating expenses might hurt the bottom line to an extent.
Other Stocks to Consider
Hope Bancorp, Inc. (HOPE - Free Report) has witnessed an upward earnings estimate revision of 26.2% for 2021 over the past 60 days. Its shares have gained 90.2% over the past six months. The company currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Blackstone Group Inc.’s (BX - Free Report) 2021 earnings estimates have increased 9.7% over the past 60 days. The company’s shares have gained 34.3% over the past six months. At present, it carries a Zacks Rank #2 (Buy).
The Goldman Sachs Group, Inc. (GS - Free Report) has witnessed an upward earnings estimate revision of 15.6% for the current year over the past 60 days. It currently carries a Zacks Rank of 2. The stock has gained 69.8% over the past six months.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
See these 7 breakthrough stocks now>>