Barclays raised the Silicon Valley Bank holding company because its estimates are above consensus, as the company can generate higher fee income.
The firm set a $135 price target.
TheStreet Ratings team rates SVB FINANCIAL GROUP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate SVB FINANCIAL GROUP (SIVB) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins, good cash flow from operations, solid stock price performance and notable return on equity. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Commercial Banks industry average. The net income increased by 4.5% when compared to the same quarter one year prior, going from $48.58 million to $50.80 million.
- The gross profit margin for SVB FINANCIAL GROUP is currently very high, coming in at 95.25%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 22.27% is above that of the industry average.
- Net operating cash flow has significantly increased by 357.54% to $155.70 million when compared to the same quarter last year. In addition, SVB FINANCIAL GROUP has also vastly surpassed the industry average cash flow growth rate of -97.39%.
- SVB FINANCIAL GROUP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SVB FINANCIAL GROUP increased its bottom line by earning $4.69 versus $3.90 in the prior year. This year, the market expects an improvement in earnings ($5.49 versus $4.69).
- Compared to its closing price of one year ago, SIVB's share price has jumped by 37.48%, exceeding the performance of the broader market during that same time frame. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
- You can view the full analysis from the report here: SIVB Ratings Report