SYF - Synchrony Financial: Finally Getting Credit

2024-04-26 03:11:20 ET

Summary

• Synchrony Financial stock has performed well in the face of growing worries about consumer spending.
• While lower-income consumers are doing less big-ticket spending, SYF continues to grow loan balances and interest income.
• Delinquencies are showing signs of peaking, and the Company is making growth moves through acquisitions and partnerships.
• Synchrony common stock is a Buy with a cheap valuation of 7.5 times adjusted earnings and an expected P/B of 1.14 at year-end 2024.
• SYF also offers preferred stocks, bonds, and deposit products. Series A is the better preferred despite its lower yield as the coupon is not resettable.

Mr. Market's Mood Improves Toward Synchrony

Synchrony Financial ( SYF ) stock has returned nearly 65% since I rated it a Strong Buy in October 2023 . Even in the past quarter, after my downgrade to a regular Buy , it has still returned 18.6%. The 6-month return more than doubled the average Financial sector return, as measured by the Financial Sector SPDR ETF ( XLF )....

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