SYNCHRONY FINANCIAL (SYF)
US87165B1035 - Common Stock
We assign a fundamental rating of 4 out of 10 to SYF. SYF was compared to 51 industry peers in the Consumer Finance industry. SYF has only an average score on both its financial health and profitability. SYF is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year SYF was profitable.
SYF had a positive operating cash flow in the past year.
Each year in the past 5 years SYF has been profitable.
In the past 5 years SYF always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 2.60%, SYF is doing good in the industry, outperforming 66.67% of the companies in the same industry.
SYF has a Return On Equity of 19.42%. This is in the better half of the industry: SYF outperforms 78.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.6% | ||
| ROE | 19.42% | ||
| ROIC | N/A |
ROA(3y)3.03%
ROA(5y)2.81%
ROE(3y)23.17%
ROE(5y)20.98%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 16.04%, SYF belongs to the top of the industry, outperforming 80.39% of the companies in the same industry.
In the last couple of years the Profit Margin of SYF has declined.
The Operating Margin and Gross Margin are not available for SYF so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | 16.04% | ||
| GM | N/A |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y11.88%
PM growth 5Y-5.69%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
SYF does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for SYF has been reduced compared to 1 year ago.
SYF has less shares outstanding than it did 5 years ago.
The debt/assets ratio for SYF is higher compared to a year ago.
2.2 Solvency
The Debt to FCF ratio of SYF is 1.59, which is an excellent value as it means it would take SYF, only 1.59 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 1.59, SYF belongs to the best of the industry, outperforming 86.27% of the companies in the same industry.
A Debt/Equity ratio of 0.98 indicates that SYF is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.98, SYF perfoms like the industry average, outperforming 58.82% of the companies in the same industry.
Although SYF does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.98 | ||
| Debt/FCF | 1.59 | ||
| Altman-Z | N/A |
ROIC/WACCN/A
WACC12.42%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
SYF shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 41.59%, which is quite impressive.
SYF shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.67% yearly.
Looking at the last year, SYF shows a quite strong growth in Revenue. The Revenue has grown by 14.58% in the last year.
Measured over the past years, SYF shows a small growth in Revenue. The Revenue has been growing by 1.08% on average per year.
EPS 1Y (TTM)41.59%
EPS 3Y29.59%
EPS 5Y6.67%
EPS Q2Q%31.08%
Revenue 1Y (TTM)14.58%
Revenue growth 3Y5.3%
Revenue growth 5Y1.08%
Sales Q2Q%5.66%
3.2 Future
Based on estimates for the next years, SYF will show a small growth in Earnings Per Share. The EPS will grow by 4.50% on average per year.
The Revenue is expected to grow by 0.48% on average over the next years.
EPS Next Y65.18%
EPS Next 2Y12.34%
EPS Next 3Y14.64%
EPS Next 5Y4.5%
Revenue Next Year7.58%
Revenue Next 2Y4.89%
Revenue Next 3Y5.41%
Revenue Next 5Y0.48%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 8.48, which indicates a very decent valuation of SYF.
Based on the Price/Earnings ratio, SYF is valued a bit cheaper than 66.67% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.53, SYF is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 9.94, the valuation of SYF can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SYF indicates a somewhat cheap valuation: SYF is cheaper than 60.78% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of SYF to the average of the S&P500 Index (23.40), we can say SYF is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.48 | ||
| Fwd PE | 9.94 |
4.2 Price Multiples
SYF's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. SYF is cheaper than 70.59% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.58 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as SYF's earnings are expected to grow with 14.64% in the coming years.
PEG (NY)0.13
PEG (5Y)1.27
EPS Next 2Y12.34%
EPS Next 3Y14.64%
5. Dividend
5.1 Amount
SYF has a Yearly Dividend Yield of 1.54%.
SYF's Dividend Yield is comparable with the industry average which is at 3.96.
SYF's Dividend Yield is slightly below the S&P500 average, which is at 2.22.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
5.2 History
On average, the dividend of SYF grows each year by 8.15%, which is quite nice.
SYF has been paying a dividend for over 5 years, so it has already some track record.
SYF has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)8.15%
Div Incr Years2
Div Non Decr Years7
5.3 Sustainability
15.02% of the earnings are spent on dividend by SYF. This is a low number and sustainable payout ratio.
SYF's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP15.02%
EPS Next 2Y12.34%
EPS Next 3Y14.64%
SYNCHRONY FINANCIAL
NYSE:SYF (11/15/2024, 8:04:00 PM)
After market: 65.1 +0.12 (+0.18%)64.98
+0.09 (+0.14%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap25.30B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.48 | ||
| Fwd PE | 9.94 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.13
PEG (5Y)1.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.6% | ||
| ROE | 19.42% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | N/A | ||
| PM (TTM) | 16.04% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.98 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)41.59%
EPS 3Y29.59%
EPS 5Y
EPS Q2Q%
EPS Next Y65.18%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)14.58%
Revenue growth 3Y5.3%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y