Fundamental Analysis
Synchrony (NYSE: SYF) is one of the nation’s premier consumer financial services companies. Our roots in consumer finance trace back to 1932, and today we are the largest provider of private label credit cards in the United States based on volume and receivables.1
We provide a range of credit products through programs we have established with a diverse group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and healthcare service providers to help generate growth for our partners and offer financial flexibility to our customers.
Through our partners’ over 380,000 locations across the United States and Canada, and their websites and mobile applications, we offer our customers a variety of credit products to finance the purchases of goods and services.
Synchrony offers private label and co-branded Dual Card™ credit cards, promotional financing and installment lending, loyalty programs and FDIC-insured savings products through Synchrony online banking.
Reasons to buy – Synchrony Financial
High level decisions on buy or sell for a stock should be driven by
1. The margin that the company makes. i.e. Out of $1 that the company sells how much does the company taken home.
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- Here we see Synchrony Financial makes a margin of 42% on Gross Level and about 15% on Net level. This means that out of $1 that it makes $0.23 is being pocketed as profits.
2. The growth rates of the company on revenue, net income, EPS and Dividend. i.e. If it sold $1 last year how much more did it sell this year.
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- Here we see net revenue growth of 8.5% in the revenue and the net profit figures grew by 28%.
3. The efficiency ratios of the company on Equity and Assets. i.e. How well is the company able to sweat each $1 that it puts to work in the company.
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- Here we see Synchrony Financial makes a Return on Assets of 2.68% and Return of Equity of 18% which is pretty good. Note being in the Financial space, with banking operations, the Assets are usually financial and huge in dollar terms and hence earning even a 2.68% as Return on Assets means a lot to the bottom line.
GOLD STANDARD : This is one of the no-debate stocks that are a must have in ones portfolio.
FAMOUS INVESTORS: This stock is owned by the Great Warren Buffett so I suppose you don’t have to think twice before investing in this counter.
All these ratios can be found in the attached excel sheets and are based on the EDGAR report submitted by Synchrony Financial to the SEC. All the data on the above analysis can be found at the link below
Balance Sheet
Income Statement
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