Industry Analysts Just Made A Notable Upgrade To Their Silvergate Capital Corporation (NYSE:SI) Revenue Forecasts
Shareholders in Silvergate Capital Corporation (NYSE:SI) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for next year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.
Following the upgrade, the most recent consensus for Silvergate Capital from its three analysts is for revenues of US$102m in 2021 which, if met, would be a sizeable 24% increase on its sales over the past 12 months. Per-share earnings are expected to shoot up 24% to US$1.37. Before this latest update, the analysts had been forecasting revenues of US$81m and earnings per share (EPS) of US$1.30 in 2021. The forecasts seem more optimistic now, with a considerable lift to revenue and a slight bump in earnings per share estimates.
See our latest analysis for Silvergate Capital
With these upgrades, we're not surprised to see that the analysts have lifted their price target 14% to US$39.00 per share. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Silvergate Capital at US$50.00 per share, while the most bearish prices it at US$26.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Silvergate Capital's rate of growth is expected to accelerate meaningfully, with the forecast 24% revenue growth noticeably faster than its historical growth of 17% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 1.3% next year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Silvergate Capital to grow faster than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for next year, expecting improving business conditions. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at Silvergate Capital.
Analysts are clearly in love with Silvergate Capital at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as recent substantial insider selling. For more information, you can click through to our platform to learn more about this and the 2 other risks we've identified .
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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