Synchrony Financial: Hold Rating Amid CFPB Rule Uncertainty and Competitive Prospects

Wells Fargo analyst Donald Fandetti maintained a Hold rating on Synchrony Financial (SYF – Research Report) yesterday and set a price target of $45.00.

Donald Fandetti has given his Hold rating due to a combination of factors surrounding Synchrony Financial. One of the primary concerns affecting the rating is the uncertainty stemming from the Consumer Financial Protection Bureau (CFPB) card late fee rule, which is entering a complex legal process rather than a straightforward implementation. This ambiguity is a double-edged sword, potentially benefiting Synchrony if there are delays or reduced chances of the rule coming to fruition, but it also creates an overhang of uncertainty that affects investor sentiment.
Additionally, Fandetti’s report indicates a positive competitive environment for Synchrony Financial, with distractions among competitors that could allow SYF to capture more market share and engage in beneficial portfolio deals. Credit trends are consistent with previous quarters, and there has been some proactive underwriting tightening in response to consumer debt patterns. Despite these favorable business trends and the company’s strong positioning for capital returns, the prevailing legal uncertainties and the impact they may have on the company’s future performance contribute to the Hold rating.

According to TipRanks, Fandetti is a 5-star analyst with an average return of 10.4% and a 62.81% success rate. Fandetti covers the Financial sector, focusing on stocks such as Capital One Financial, American Express, and Discover Financial Services.

TipRanks tracks over 100,000 company insiders, identifying the select few who excel in timing their transactions. By upgrading to TipRanks Premium, you will gain access to this exclusive data and discover crucial insights to guide your investment decisions. Begin your TipRanks Premium journey today.

Synchrony Financial (SYF) Company Description:

Synchrony Financial engages in the provision of consumer financial services. It operates through three sales platforms: Retail Card, Payment Solutions, and CareCredit. The Retail Card platform is a provider of private label credit cards, and also provides Dual Cards and small-and medium-sized business credit products. The Payment Solutions platform is a provider of promotional financing for major consumer purchases, offering private label credit cards and instalment loans. The CareCredit platform is a provider of promotional financing to consumers for elective healthcare procedures or services, such as dental, veterinary, cosmetic, vision and audiology. The company was founded on September 12, 2003 and is headquartered in Stamford, CT.