Synchrony Financial (SYF – Research Report), the Financial sector company, was revisited by a Wall Street analyst today. Analyst Moshe Orenbuch from TD Cowen maintained a Buy rating on the stock and has a $44.00 price target.
Moshe Orenbuch assigned a Buy rating to Synchrony Financial for several reasons that reflect the company’s sound financial strategy and potential for growth. Firstly, he observed a stable trend in late fees, which remained flat year-over-year at $2.7 billion, despite a rising delinquency rate. This stability is seen as a strength, especially in light of upcoming regulations on late fees. Moreover, the shift in the loan portfolio towards a greater proportion of fixed-rate loans, now at 62%, positions Synchrony Financial favorably in the event of a downward interest rate cycle, enhancing the defensiveness of the loan yield.
Additionally, Synchrony’s strategic account management, which resulted in an increase in active accounts to 73.5 million, demonstrates an improvement in customer engagement. This is coupled with the significant Sam’s Club portfolio, which has grown in concentration and now represents over 10% of the portfolio, indicating a robust relationship with a major retailer. Furthermore, the proactive approach of raising the minimum wage for hourly employees underscores the company’s commitment to its workforce, which can contribute to employee satisfaction and retention, potentially leading to improved performance. These factors combined provide a solid foundation for Orenbuch’s positive outlook on Synchrony Financial’s stock.
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Synchrony Financial (SYF) Company Description:
Synchrony Financial engages in the provision of consumer financial services. It operates through three sales platforms: Retail Card, Payment Solutions, and CareCredit. The Retail Card platform is a provider of private label credit cards, and also provides Dual Cards and small-and medium-sized business credit products. The Payment Solutions platform is a provider of promotional financing for major consumer purchases, offering private label credit cards and instalment loans. The CareCredit platform is a provider of promotional financing to consumers for elective healthcare procedures or services, such as dental, veterinary, cosmetic, vision and audiology. The company was founded on September 12, 2003 and is headquartered in Stamford, CT.
Read More on SYF:
- Synchrony assumed with an Underweight at Morgan Stanley
- Synchrony put volume heavy and directionally bearish
- Synchrony partners with PatientNow for payment technology in cosmetic industry
- Synchrony Announces Quarterly Common Stock Dividend of $0.25 Per Share
- Synchrony price target raised to $48 from $46 at Piper Sandler
