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Synchrony Financial reported a mixed bag of Q4 results, with revenue and EPS falling short of estimates. Key risks include the potential implementation of the CFPB's late fee rule and increasing competition from digital-native banking companies. Stock screens cheap at 9x forward EPS, and while above historical norms, EPS growth may be 15-16% over the next two years.
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Does Synchrony (SYF) have what it takes to be a top stock pick for momentum investors? Let's find out.
Investors interested in stocks from the Financial - Miscellaneous Services sector have probably already heard of Synchrony (SYF) and SoFi Technologies, Inc. (SOFI). But which of these two companies is the best option for those looking for undervalued stocks?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
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Synchrony Financial experienced lower loan growth in preparation for a rule limiting late fees. Nevertheless, core 2025 EPS is forecasted to grow by 12.9%, with a P/E of 8.6. Synchrony's tighter credit standards have reduced delinquency rates, and potential removal of the late fee rule could accelerate loan growth. Preferred shares offer income opportunities: Series A does better with falling rates, and Series B outperforms during rising rates.
SYF expects net revenues between $15.2 and $15.7 billion in 2025, lower from $16.1 billion in 2024.
Synchrony Financial (NYSE:SYF ) Q4 2024 Earnings Conference Call January 28, 2025 8:00 AM ET Company Participants Kathryn Miller - Senior Vice President, Investor Relations Brian Doubles - President and Chief Executive Officer Brian Wenzel - Executive Vice President and Chief Financial Officer Conference Call Participants Ryan Nash - Goldman Sachs Sanjay Sakhrani - KBW Mihir Bhatia - Bank of America Terry Ma - Barclays Moshe Orenbuch - TD Cowen Jeff Adelson - Morgan Stanley John Hecht - Jefferies John Pancari - Evercore ISI Bill Carcache - Wolfe Research Rob Wildhack - Autonomous Research Brennan Crowley - Robert W. Baird Erika Najarian - UBS Operator Good morning and welcome to the Synchrony Financial Fourth Quarter and Full-Year 2024 Earnings Conference Call.
The consumer financing landscape is a dynamic one, where both strategy and execution are the key guardrails of success for financial service businesses. This was reiterated on Tuesday (Jan. 28) during Synchrony Financial's fourth-quarter and full-year 2024 earnings report.
Synchrony Financial (SYF) shares tumbled 7% Tuesday morning as the online bank's results missed estimates on increased credit expenses and weak net interest income.