SIVB - Is Silicon Valley Bank Stock a Buy After Downgrading 2022 Guidance?
A lot has changed since SVB Financial Group (NASDAQ: SIVB) -- better known as Silicon Valley Bank -- released its first takes on the brewing stock market turmoil this past spring. 2022 has turned into an all-out bear market. The private equity and venture capital markets were holding up well early on, but Silicon Valley Bank's most recent update for Q2 2022 indicates some of the public stock market pain is now spilling over into the "innovation economy," or the small upstart businesses and their private investors aiming to disrupt established industries.
SVB is holding up well considering the chaos going on out there, and its long-term prospects remain bright. But it could be a longer road getting back to growth than I expected earlier this year.
A number of factors conspired against SVB's Q2 2022 financial results . The investment bank was lapping what was still a hot IPO market in the spring of 2021 (global IPO proceeds were down 58% year over year in the first half of 2022, according to research group EY). That reduces the fee income SVB takes from clients that are planning to raise capital via public stock markets.
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Is Silicon Valley Bank Stock a Buy After Downgrading 2022 Guidance?