Morgan Stanley downgraded Synchrony (SYF) to Equal Weight from Overweight with a price target of $44, down from $82. The firm says heightened recession risks has changed its thinking on the shares. As an issuer of retailer credit cards, Synchrony is highly exposed to discretionary spending volumes from consumers, particularly at these key retail partners, the analyst tells investors in a research note. addition, 26% of the company’s borrowers are subprime, who are at more risk of getting hit with any cash flow squeeze as inflation on imported goods ramps, contends Morgan Stanley.
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