As cryptocurrency bank Silvergate (SI:NYE) prepares to release its fourth-quarter 2022 earnings results on January 17, analysts are approaching the report with caution. In the lead-up to the earnings release, Silvergate stock has seen a number of downgrades and cautious takes, with a consensus rating of Hold based on three Buys, five Holds, and two Sells.
For the fourth quarter, analysts are forecasting earnings of $0.68 per share, a 3% year-over-year increase. However, there are concerns about the company’s deposit-funding decline, which is expected to have had a negative impact on the bottom line for the quarter.
Additionally, the FTX crash in early November led to regulatory scrutiny for crypto banks like Silvergate, creating an overhang for the company in the fourth quarter.
Another factor that may have contributed to the company’s Q4 performance is the layoffs of around 200 workers, which would have resulted in costs associated with the firings, along with securities losses and impairment charges. These actions are expected to have resulted in significant impairment charges in Q4.
Despite the cautious outlook, Silvergate stock price is expected to increase 23.8% over the next 12 months to $16.80. However, it is important to note that this prediction is based on analysts’ estimates and not a guarantee of future performance.
Company Profile:
Silvergate Capital Corporation operates as a bank holding company for Silvergate Bank that provides banking products and services to business and individual clients in the United States.
The company accepts deposit products, including interest and noninterest bearing demand accounts, money market and savings accounts, and certificates of deposit accounts. Its loan products comprise one-to-four family real estate loans, multi-family real estate loans, commercial real estate loans, construction loans, commercial and industrial loans, mortgage warehouse loans, and reverse mortgage loans, as well as consumer loans and other loans secured by personal property.
The company also provides cash management services for digital currency-related businesses. Silvergate Capital Corporation was founded in 1988 and is headquartered in La Jolla, California.
