Synchrony Financial (SYF) AI Stock Analysis

• Market Cap: $20.33B
• Dividend Yield: 1.87%
• Average Volume (3M): 5.04M
• Price to Earnings (P/E): 7.4
• Beta (1Y): 1.32
• Revenue Growth: 1.22%
• EPS Growth: 4.96%
• Country: US
• Employees: 20,000
• Sector: Financial
• Sector Strength: 83
• Industry: Financial - Credit Services
• EPS (TTM): 1.89
• Shares Outstanding: 380,650,700
• 10 Day Avg. Volume: 4,419,034
• 30 Day Avg. Volume: 5,042,506
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 0.85
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 1.83
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $64.69
• Price Target Upside: 20.31% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

Synchrony Financial stands out with a strong financial performance and attractive valuation, despite high debt levels and mixed earnings call insights. While technical indicators suggest caution due to potential short-term volatility, the stock remains a solid choice for those focusing on long-term value and income through dividends.

Positive Factors

Credit Performance

Management's commentary was viewed positively, particularly due to lower-than-estimated charge-offs and the expectation of accelerating growth in the second half of the year.

Earnings

The company reported earnings per share significantly above expectations.

Shareholder Returns

A healthy $2.5 billion share buyback has been announced, along with a 20% dividend hike.

Negative Factors

Loan Growth

Loan growth has slowed, similar to direct peers.

Macroeconomic Concerns

A key risk for Synchrony Financial is macroeconomic uncertainty or an increase in unemployment.

Purchase Volume

Purchase volumes were slightly lower than expected, and net interest margin missed forecasts due to excess liquidity.

Synchrony Financial Business Overview & Revenue Model

Company Description

Synchrony Financial, together with its subsidiaries, operates as a consumer financial services company in the United States. It provides credit products, such as credit cards, commercial credit products, and consumer installment loans. The company also offers private label credit cards, dual cards, co-brand and general purpose credit cards, short- and long-term installment loans, and consumer banking products; and deposit products, including certificates of deposit, individual retirement accounts, money market accounts, and savings accounts to retail and commercial customers, as well as accepts deposits through third-party securities brokerage firms. In addition, it provides debt cancellation products to its credit card customers through online, mobile, and direct mail; healthcare payments and financing solutions under the CareCredit, Pets Best, and Walgreens brands; payments and financing solutions in the apparel, specialty retail, outdoor, music, and luxury industries; and point-of-sale consumer financing for audiology products and dental services. The company offers its credit products through programs established with a group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations, and healthcare service providers; and deposit products through various channels, such as digital and print. It serves digital, health and wellness, retail, home, auto, powersports, jewelry, pets, and other industries. Synchrony Financial was founded in 1932 and is headquartered in Stamford, Connecticut.

How the Company Makes Money

Synchrony Financial primarily generates revenue through interest income earned from its credit products. The company's key revenue streams include interest on outstanding credit card balances, fees charged on credit card transactions, and merchant fees from retail partners. Synchrony's strategic partnerships with major retailers and service providers allow it to leverage their customer bases to drive credit card usage and increase transaction volumes. Additionally, the company benefits from cross-selling opportunities with its partners, enhancing its revenue through value-added services such as promotional financing and loyalty programs.

Synchrony Financial Financial Statement Overview

Summary

Synchrony Financial shows a strong financial position with robust revenue growth and profitability. The company manages a healthy cash flow, though it faces high debt levels, which necessitate careful management to ensure sustainable growth.

Income Statement

Synchrony Financial demonstrates strong gross profit margins and a consistent increase in total revenue, indicating healthy revenue growth. The net profit margin shows some volatility but remains robust, signaling profitability. However, the EBIT margin has shown slight fluctuations, reflecting operational costs that need monitoring.

Balance Sheet

The company's debt-to-equity ratio is moderately high, reflecting a substantial reliance on debt financing, which could pose risks in volatile market conditions. However, the return on equity is commendable, indicating effective use of equity to generate profits. The equity ratio suggests a solid capital structure with sufficient equity backing.

Cash Flow

Operating cash flow is strong, supporting net income effectively, and the company maintains a healthy free cash flow. While free cash flow growth has been inconsistent, the overall cash flow position remains solid, providing flexibility for future investments and debt repayment.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
9.39B	7.66B	16.00B	10.19B	11.16B
	Gross Profit
9.39B	7.66B	14.63B	9.29B	9.74B
	EBIT
5.26B	3.66B	5.44B	5.50B	1.80B
	EBITDA
0.00	0.00	4.89B	6.36B	2.84B
	Net Income Common Stockholders
3.50B	2.24B	3.02B	4.22B	1.39B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
17.79B	18.06B	15.17B	13.62B	18.99B
	Total Assets
119.46B	117.48B	104.56B	95.75B	95.95B
	Total Debt
15.46B	15.98B	14.19B	14.51B	15.78B
	Net Debt
751.00M	1.72B	3.90B	6.17B	4.25B
	Total Liabilities
102.88B	103.58B	91.69B	82.09B	83.25B
	Stockholders Equity
16.58B	13.90B	12.87B	13.65B	12.70B
Cash Flow		Free Cash Flow
9.85B	8.59B	6.69B	7.10B	7.49B
	Operating Cash Flow
9.85B	8.59B	6.69B	7.10B	7.49B
	Investing Cash Flow
-8.90B	-14.23B	-10.23B	-4.81B	-498.00M
	Financing Cash Flow
-611.00M	9.63B	5.28B	-5.20B	-8.03B

Synchrony Financial Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 53.77
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SYF, the sentiment is Positive. The current price of 53.77 is above the 20-day moving average (MA) of 50.05, above the 50-day MA of 51.93, and below the 200-day MA of 56.10, indicating a neutral trend. The MACD of 0.62 indicates Negative momentum. The RSI at 57.94 is Neutral, neither overbought nor oversold. The STOCH value of 80.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SYF.

Synchrony Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DFS	78 Outperform	$47.34B	10.16	28.29%	1.49%	9.42%	128.55%
SYF	71 Outperform	$20.33B	7.44	18.60%	1.87%	1.22%	4.96%
IX	69 Neutral	$21.68B	8.81	10.07%	3.23%	0.31%	34.40%
ALLY	69 Neutral	$10.20B	24.40	3.84%	3.69%	-2.90%	-43.64%
OMF	68 Neutral	$5.76B	10.36	17.46%	8.60%	9.07%	―
SOFI	68 Neutral	$14.06B	30.27	7.51%	―	21.24%	―
Sector *	64 Neutral	$12.51B	9.81	7.92%	16985.69%	12.67%	-5.98%

Synchrony Financial Corporate Events

Synchrony Financial Releases March 2025 Charge-Off Data

Synchrony Financial has released its monthly charge-off and delinquency statistics for the thirteen months ending March 31, 2025. The company plans to continue providing these statistics on a monthly basis, aligning the release of quarterly statistics with their financial results announcements. This initiative aims to enhance transparency in financial reporting and provide stakeholders with timely insights into the company’s financial health.

Spark’s Take on SYF Stock

According to Spark, TipRanks’ AI Analyst, SYF is a Outperform.

Synchrony Financial scores well due to strong financial performance and an attractive valuation. While technical indicators suggest some caution due to bearish trends, the company’s strategic growth and partnerships, coupled with a solid dividend yield, make it a compelling investment in the credit services sector.

To see Spark’s full report on SYF stock, click here.

Synchrony Financial Releases January 2025 Charge-Off Data

Synchrony Financial has released its monthly charge-off and delinquency statistics for the thirteen months ending January 31, 2025. The company plans to continue providing these statistics each month, highlighting trends in its financial performance that could impact stakeholders and reflect its operational focus on maintaining transparency.