Perhaps timely catching Synchrony Financial (SYF) would be a good idea

Synchrony Financial (NYSE: SYF) stock jumped 8.69% on Friday to $35.41 against a previous-day closing price of $32.58. With 12.09 million shares changed hands, the volume of the stock remained heavier than its average volume of 5.39 million shares. During the session, the Credit Services company that operates in wider Financial sector, reached to the highest price of $35.42 whereas the lowest price it dropped to was $32.86. The 52-week range on SYF shows that it touched its highest point at $47.05 and its lowest point at $27.22 during that stretch. It currently has a 1-year price target of $39.78. With its current market cap of 14.68 billion, SYF has annualized dividend of $0.92 while the current yield stands at 2.60%. Beta for the stock currently stands at 1.62.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of SYF was up-trending over the past week, with a rise of 5.45%, but this was up by 9.36% over a month. Three-month performance surged to 12.09% while six-month performance rose 8.42%. The stock lost -22.41% in the past year, while it has gained 7.76% so far this year. A look at the trailing 12-month EPS for SYF yields 6.33 with Next year EPS estimates of 4.80. For the next quarter, that number is 1.11. This implies an EPS growth rate of 222.90% for this year and -19.67% for next year. EPS is expected to decline by -3.62% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 22.10%.

Float and Shares Shorts:

At present, 468.50 million SYF shares are outstanding with a float of 448.57 million shares on hand for trading. On Oct 13, 2022, short shares totaled 16.49 million, which was 3.59% higher than short shares on Sep 14, 2022. In addition to Ms. Margaret M. Keane as the firm’s Exec. Chair of the Board, Mr. Brian D. Doubles serves as its Pres, CEO & Director.

Institutional Ownership:

Through their ownership of 104.66% of SYF’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 56.75% of SYF, in contrast to 42.63% held by mutual funds. Shares owned by individuals account for 0.68%. As the largest shareholder in SYF with 13.16% of the stake, The Vanguard Group, Inc. holds 59,299,848 shares worth 59,299,848. A second-largest stockholder of SYF, Capital Research & Management Co, holds 45,090,752 shares, controlling over 10.01% of the firm’s shares. BlackRock Fund Advisors is the third largest shareholder in SYF, holding 24,579,740 shares or 5.46% stake. With a 4.92% stake in SYF, the American Balanced Fund is the largest stakeholder. A total of 22,145,238 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 3.04% of SYF stock, is the second-largest Mutual Fund holder. It holds 13,677,419 shares valued at 449.44 million. Fidelity Low Priced Stock Fund holds 2.80% of the stake in SYF, owning 12,616,582 shares worth 414.58 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for SYF since 22 analysts follow the stock currently. There are 11 analysts who recommend BUY ratings, while 3 suggest SELL ratings. Of the remaining analysts, 7 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 1 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With SYF analysts setting a high price target of $56.00 and a low target of $27.00, the average target price over the next 12 months is $39.30. Based on these targets, SYF could surge 58.15% to reach the target high and fall by -23.75% to reach the target low. Reaching the average price target will result in a growth of 10.99% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. SYF will report FY 2022 earnings on 01/26/2024. Analysts have provided yearly estimates in a range of $6.24 being high and $5.74 being low. For SYF, this leads to a yearly average estimate of $5.96. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Synchrony Financial surprised analysts by $0.08 when it reported $1.47 EPS against a consensus estimate of $1.39. The surprise factor in the prior quarter was $0.19. Based on analyst estimates, the high estimate for the next quarter is $1.43 and the low estimate is $0.88. The average estimate for the next quarter is thus $1.11.

Summary of Insider Activity:

Insiders traded SYF stock several times over the past three months with 29 Buys and 4 Sells. In these transactions, 15,134 shares were bought while 126,734 shares were sold. The number of buy transactions has increased to 137 while that of sell transactions has risen to 35 over the past year. The total number of shares bought during that period was 467,988 while 444,833 shares were sold.

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