February 22, 2024
Top 10 Stock Synchrony Financial Strong Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Synchrony Financial – Top 10 Stock in S&P 500 Index
Synchrony Financial is listed as a top 10 stock on February 22, 2024 in the market index S&P 500 because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 98 (top 98% performer), Obermatt assesses an overall strong buy recommendation for Synchrony Financial on February 22, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Consumer Finance |
| Index | Customer Focus US, Employee Focus US, Diversity USA, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Synchrony Financial Strong Buy
| 360 METRICS | February 22, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 89 |
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| GROWTH | ||||||||
| GROWTH | 71 |
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| SAFETY | ||||||||
| SAFETY | 73 |
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| SENTIMENT | ||||||||
| SENTIMENT | 77 |
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| 360° VIEW | ||||||||
| 360° VIEW | 98 |
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ANALYSIS: With an Obermatt 360° View of 98 (better than 98% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Synchrony Financial are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for Synchrony Financial. The consolidated Value Rank has an attractive rank of 89, which means that the share price of Synchrony Financial is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 89% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 71, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The company is also safely financed with a Safety rank of 73. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 77. ...read more
RECOMMENDATION: With a consolidated 360° View of 98, Synchrony Financial is better positioned than 98% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 89), above-average growth (Growth Rank of 71), safe financing practices (Safety Rank of 73), and a positive market sentiment in the professional investor community (Sentiment Rank of 77), it is a solid stock investment where the risk of paying too much for the shares is limited and disappointments are less likely to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Synchrony Financial is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for Synchrony Financial very positive
ANALYSIS: With an Obermatt Sentiment Rank of 77 (better than 77% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Synchrony Financial is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Synchrony Financial. Analyst Opinions are at a rank of 36 (worse than 64% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 89, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Synchrony Financial. More encouragingly, the Professional Investors rank is 85, which means that professional investors hold more stock in this company than in 85% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 42, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 58% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 77 (more positive than 77% compared with investment alternatives), Synchrony Financial has a reputation among professional investors that is significantly higher than that of its competitors. The sentiment signals are mixed for Synchrony Financial. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Synchrony Financial Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 89 (better than 89% compared with alternatives) for 2024, Synchrony Financial shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Synchrony Financial. Price-to-Sales is 82 which means that the stock price compared with what market professionals expect for future sales is lower than for 82% of comparable companies, indicating a good value for Synchrony Financial's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 87% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 73. Compared with other companies in the same industry, dividend yields of Synchrony Financial are expected to be higher than for 61% of all competitors (a Dividend Yield rank of 61). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 89, is a buy recommendation based on Synchrony Financial's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Synchrony Financial based on its detailed value metrics.
Growth Strategy: Synchrony Financial Growth Momentum good
| GROWTH METRICS | February 22, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 53 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 47 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 67 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 61 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 71 |
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ANALYSIS: With an Obermatt Growth Rank of 71 (better than 71% compared with alternatives), Synchrony Financial shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Synchrony Financial. Sales Growth has a rank of 53 which means that currently, professionals expect the company to grow more than 53% of its competitors. Capital Growth is also above 47% of competitors with a rank of 67, and Stock Returns with the rank of 61 is also an outperformance. Only Profit Growth is low with a rank of 47 which means that currently, professionals expect the company to grow its profits less than 53% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 71, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Synchrony Financial is a good growth stock. ...read more
Safety Strategy: Synchrony Financial Debt Financing Safety above-average
| SAFETY METRICS | February 22, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 82 |
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| REFINANCING | ||||||||
| REFINANCING | 49 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 31 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 73 |
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ANALYSIS: With an Obermatt Safety Rank of 73 (better than 73% compared with alternatives), the company Synchrony Financial has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Synchrony Financial is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Synchrony Financial and the other two below average. Leverage is at a rank of 82 meaning the company has a below-average debt-to-equity ratio. It has less debt than 82% of its competitors.Refinancing is at a rank of 49, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 51% of its competitors. Liquidity is at a rank of 31, meaning that the company generates less profit to service its debt than 69% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 73 (better than 73% compared with alternatives), Synchrony Financial has a financing structure that is safer than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Synchrony Financial are on the safer side. ...read more
Combined financial peformance: Synchrony Financial Top Financial Performance
| COMBINED PERFORMANCE | February 22, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 89 |
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| GROWTH | ||||||||
| GROWTH | 71 |
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| SAFETY | ||||||||
| SAFETY | 31 |
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| COMBINED | ||||||||
| COMBINED | 100 |
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ANALYSIS: With an Obermatt Combined Rank of 100 (better than 100% compared with investment alternatives), Synchrony Financial (Consumer Finance, USA) shares have much better financial characteristics than comparable stocks. Shares of Synchrony Financial are a good value (attractively priced) with a consolidated Value Rank of 89 (better than 89% of alternatives), show above-average growth (Growth Rank of 71), and are safely financed (Safety Rank of 73), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 100, is a strong buy recommendation based on Synchrony Financial's financial characteristics. As the company Synchrony Financial's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 89), above-average growth (Obermatt Growth Rank of 71), and indicate that the company is safely financed (Obermatt Safety Rank of 73), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Synchrony Financial. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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