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Based in Stamford, Connecticut, Synchrony Financial (SYF) is a consumer financial services company. With a market cap of $18.4 billion, the company offers a wide range of credit cards, short and long-term installment loans, and consumer banking products, including various deposit products.
Shares of this consumer credit company have significantly outperformed the broader market over the past 52 weeks. SYF has gained 31.6% over this time frame, while the broader S&P 500 Index ($SPX) has increased 21.7%. In 2024, shares of SYF are up 19.8%, compared to SPX’s 13.9% gain on a YTD basis.
Zooming in further, SYF’s outperformance becomes more evident when compared to the DWA Financial Momentum Invesco ETF’s (PFI) 17% gain over the past 52 weeks and 13.2% returns on a YTD basis.
Shares of SYF rose 2.7% following its Q2 earnings release on Jul. 17 due to a significant increase in net profit driven by higher interest income from its credit card loans. Despite rising loan loss provisions, the strong earnings performance and the ability to offset increased credit losses with robust interest income bolstered investor confidence.
For the current fiscal year, ending in December, analysts expect SYF’s EPS to grow 11.8% year over year to $5.80. The company’s earnings surprise history is mixed. It beat the consensus estimates in three of the last four quarters while missing on another occasion.
Among the 23 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 13 “Strong Buy” ratings, one “Moderate Buy,” seven “Holds,” and two “Strong Sells.”
The configuration is more bullish than three months ago, with nine analysts suggesting a “Strong Buy.”
On Jul. 18, Jefferies maintained a “Buy” rating on SYF and raised the price target to $60, noting the company’s better-than-expected Q2 earnings report.
The mean price target of $52.96 represents a premium of 15.8% to SYF’s current levels. The street-high price target of $62, implies a potential upside of 35.5% from the current price.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
