4. Silvergate Capital Corporation (NYSE:SI)
ARK Investment Management’s 13 Portfolio: 0.3%
ARK Investment Management’s Stake Value: $72.04 million
Number of Hedge Fund Holders: 37
Silvergate Capital Corporation (NYSE:SI) operates as a bank holding firm with sizeable interests in fintech products and services. It enjoys a unique dominance in the bitcoin trading market, and recently acquired blockchain-based payment system project called Diem.
B. Riley analyst Steve Moss on May 12 reiterated a ‘Buy’ rating on Silvergate Capital Corporation (NYSE:SI) shares and revised the price target to $235 from $260. The Diem acquisition has the potential to drive substantial growth in earnings, and the analyst holds that the recent sell-off creates an attractive entry point as the current valuation assigns limited value to the Diem acquisition.
For the first quarter of 2022, Silvergate Capital Corporation (NYSE:SI) recorded an EPS of $0.80, outperforming estimates by $0.33. Quarterly revenue grew 92.7% year-on-year to come in at roughly $60 million, beating estimates by $5.1 million.
Cathie Wood, according to the 13F filings for the first quarter of 2022, owned approximately 479,000 shares of Silvergate Capital Corporation (NYSE:SI) worth $72 million, showing an increase of 17% in holding from the previous quarter. In total, 37 hedge funds were long on the company shares at the close of Q4 2021, showing a positive trend from the preceding quarter where 32 hedge funds held positions in the company.
Investment firm Artisan Partners mentioned Silvergate Capital Corporation (NYSE:SI) in its Q3 2021 investor letter. The fund said:
“Silvergate Capital is the leading regulated provider of traditional banking solutions to the digital currency industry (DCI). Notable customers include Coinbase, Paxos, Circle, Binance, Gemini, Jane Street, Fidelity, ICE, PayPal and the CME Group. We believe the company is well positioned to grow as digital assets become an increasing part of the economy. As a bridge between regulated financial markets and the crypto industry, Silvergate has established itself as a core infrastructure layer for trading digital assets. The company provides regulated banking services to the DCI to capture low-cost funding deposits, which can be monetized through its securities and loan portfolio. As of Q3, the company had $11 billion of deposits from over 1,300 digital currency customers and processed $600 million in transaction volumes over the last 12 months through the Silvergate Exchange Network (SEN). Today, the majority of SEN transactions are not being monetized to reduce friction of growing the network; however, we believe this could become an additional profit cycle driver over time as new products are launched or if the technology is adopted for use cases such as cross-border remittance or commerce.”
