Silvergate Capital (SI) Added to Wedbush Best Ideas List; Bullish on Diem Deal

May 19, 2021 7:05 AM EDT
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(Updated - May 19, 2021 7:22 AM EDT)

Wedbush added Silvergate Capital (NYSE: SI) to its Best Ideas List. Analyst David Chiaverini maintained an outperform rating and $175 price target.

The analyst commented: "The economics to Silvergate from the Diem partnership are much better than we originally anticipated in two important ways: 1) as the exclusive issuer of the Diem stablecoins, Silvergate will retain the interest income generated from investing the reserve balances in Treasury securities and 2) Silvergate plans to implement a basis point take-rate on the dollar volume of mint/burn transactions, which we believe could range from 5-15 bp. We view the upside potential to Silvergate's earnings as significant and we believe is underpriced relative to its current stock price."

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