SVB Financial Group

Investment Analysis Clubs Where Angels Fear to Tread
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If one spends some time perusing reader comments on the Seeking Alpha website, it becomes obvious that many people continue succumbing to price-anchoring, possess a gambling mentality, and rely on SA contributors for guidance on what to do.

These traits were on full display today in regards to SVB Financial Group (SIVB), a financial services company that includes the now-failed Silicon Valley Bank as its main subsidiary. In an article titled “SVB Financial: A Doom and Gloom Buying Moment” that was posted today at 6:00am Eastern Time, the author rated SIVB a “Speculative Buy”. In the comments section, a number of people confidently disclosed they acted on that viewpoint during the pre-market trading session, seemingly pleased with the sub-$40 price they paid for their shares versus the $260+ share price earlier this week, which in turn was well-below the $750+ share price in late 2021. Subsequent news of the bank’s failure has left them feeling less confident about that decision.

A few hours after trading was halted in response to the FDIC takeover of the bank, another Seeking Alpha author helpfully attached a “Hold” rating to his post-failure analysis of the company. In a remarkable demonstration of solidarity, every single shareholder of SIVB is presently following that recommendation.

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Well done. Ha.

I dont pretend to be an expert here and will defer to others. May need to separate the parent company from SVB itself, when looking at potential contagion casualties.

But saw on twitter (so it must be true!) that ROKU and RBLX both had sizable cash or something with either SVB or their parent.

ROKU down in AH a bit due to this news/rumor. Not saying roku going out of business, just that they may have had a large chunk of their cash w svb, and i dont know what impact, if any, that has on their operations or accounting in next ER.

So this may be a nothing-burger by Monday or it may have some after shocks. Will see.

Dreamer

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Was the market open Monday? Must have been, my IRA balance changed… up $66.06. So I won’t be digging roots in the jungle today, flush with cash. My God!, that’s almost 4,000 Pesos, stable Philippine currency. DW off to town. (Side note, went to dentist Saturday and walked by hole-in-the-wall shoe store. My knock abouts are well beyond 5 half life’s so I went in. Found a couple of pairs of Made-in-China’s Finest brands–and of course DW had to have a pair, can’t pass up a bargain, ever,… But at checkout, guess what, “buy 5 pair get 20% off” Highschool math… that’s like buy 4 get 1 free, so back to the racks. $9 bucks a pair before the discount. They haven’t worn out yet…)

Well, enough travelogue, back to stocks before the Great Seer labels us a social site and I get us sent to purgatory, which would be o.k. 'cause that’s where my IRA is anyway.

I wasn’t idle Monday. DST now so market opens at 2130 here (that’s military-speak for 9:30 p.m. for the non-ROTC types out there) :slight_smile: NCNO sells software to banks for digital interface with customers. Since all banks are going out of existence in a fortnight, NCNO was down 15% shortly after open, and down 30% since last mid-week. Stroll over to IR and find a fresh 8-k:

  The Company provides cloud-based SaaS services to both SVB
  and Signature Bank. SVB and Signature Bank collectively contributed
  less than two percent (2%) of the Company’s total revenues in the
  third quarter of fiscal year 2023.

Check the latest 10-Q (3 Q, October) NCNO had $111 million cash and cash equivalent at Q3 and $47 million of it in money market, so it could have had $64 million in cash deposits somewhere? 10-Q does not disclose, AFAIKT. Next report March 28. Anyway, in the nature of Ready, Shoot, Aim, I moved 0.24% of port into more NCNO which resulted in providing most of my day’s massive gain.

Markets pointing up slightly, 8 hours before open.

KC

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I’m wondering why the consensus for the holding company stock should go to zero when there are other business units that aren’t affected. I also heard the holding company may be bidding on the commercial bank that failed. Wouldn’t that sale, should it materialize, restore value in the current stock?
Thnx

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I am not sure about the process for liquidating, buying or shooting SVB. What did catch my attention today was some worry about Charles Schwab, the company. I was thinking, “Good on ya, Schwabby hope your rot in SIPC Hell” (they the ones that won’t do business with the likes of us live-in-the-jungle types ‘cause we probly laund’rin’ money fer the Ruskians) :slight_smile: But anyway, got me to researchin’ insurance coverage on brokerage accounts. Only up to $250,000 for cash so I know of some people around here who are swimmin’ necked by holden’ cash. Its $500,000 total of which only $250,000 can be cash. You can count an IRA as one account and a taxable as another 'cause they different types. Two taxables get lumped together. Hubby and DW’s are separate. All per broker, so can spread yer wealth around. Clear? Quiz tomorrow. I am not a lawyer and don’t play one on TV, so take all this in the fashion of for what it is worth and there ain’t no KC insurance corporation set up by the Feds. Which makes one wonder, just who is insuring the SIPC?

The SIPC is a federally mandated, private nonprofit organization. Glad they got my back.

Warms the cockles of yer heart, don’t it?

KC

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