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SVB Financial Soars to 52-Week High

Zacks Equity Research

Shares of SVB Financial Group (SIVB) reached a new 52-week high, touching $80.88 in the last hour of the trading session on Jun 24, 2013. The closing price of this regional bank reflected a robust year-to-date return of 38.0%. The trading volume for the session was 0.5 million shares, higher than the average of 0.2 million over the last 3 months.

Despite the strong price appreciation, this Zacks Rank #3 (Hold) stock has plenty of upside left, given its estimate revisions over the last 60 days for 2013 and expected long-term earnings growth of 11.0%.

Growth Drivers

Impressive first-quarter 2013 results, strong capital position and a declining long-term debt were the primary growth drivers for SVB Financial.

SVB Financial’s first-quarter earnings marginally beat the Zacks Consensus Estimate. Results benefited from growth in top line, partially offset by a rise in operating expenses. Improvement in asset quality as well as capital and profitability ratios, and stable loan and deposit growth were among the positives.

Further, SVB Financial has been consistently lowering its long-term debt levels. Reduction in long-term debt will lead to lower interest expenses, which in turn will boost the top line.

Estimate Revisions

Over the last 60 days, 6 out of 13 estimates for 2013 have been revised upward, lifting the Zacks Consensus Estimate by 1.1% to $3.77 per share. However, for 2014, the Zacks Consensus Estimate fell 1.2% to $3.96 per share over the same time period.

Better performing banks include Central Pacific Financial Corp. (CPF), Preferred Bank (PFBC) and TriCo Bancshares (TCBK), all of which carry a Zacks Rank #1 (Strong Buy).

Read the Full Research Report on CPF

Read the Full Research Report on PFBC

Read the Full Research Report on TCBK

Read the Full Research Report on SIVB

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