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Synchrony Financial (SYF) has drawn fresh attention as investors reassess its recent trading performance, with the stock’s one-month and three-month returns being weighed against its longer term track record.
See our latest analysis for Synchrony Financial.
The recent 2.7% 1-day share price return to US$70.77 comes after weaker momentum over the past month and quarter, while the 1-year and multi year total shareholder returns remain firmly positive. This suggests sentiment has shifted rather than erased longer term gains.
If this kind of pullback has you looking for other opportunities in financials and beyond, it could be a good moment to scan 22 top founder-led companies as potential next ideas.
With Synchrony trading at US$70.77 alongside an indicated intrinsic discount of about 55% and a sizeable gap to the average analyst price target, you have to ask: is there real value here, or is the market already pricing in future growth?
According to the most followed narrative on Synchrony, a fair value of about $105 per share sits well above the recent $70.77 close, which puts a sizable discount in focus for long term investors weighing today’s pullback.
Your DCF/Excess Return analysis suggests Synchrony Financial’s intrinsic value is around $145 per share, meaning the stock could be trading at a steep discount (~40% undervalued) versus its fundamental long-term economic profit potential. Current market pricing and consensus analyst targets are significantly lower, around the mid-$80s to ~$100, mainly because of short-term earnings expectations and risk pricing.
There is a clear tension here, with the narrative leaning on robust return on equity, steady book value compounding, and a relatively low discount rate to justify that higher fair value. Want to see exactly how those moving parts combine into a triple digit target for Synchrony, and how that connects back to today’s $70s share price? The full narrative walks through the numbers step by step.
Result: Fair Value of $105 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, the narrative could crack if credit losses rise sharply or new regulations pressure fee income and returns on Synchrony’s US$3,469m in annual net income.
Find out about the key risks to this Synchrony Financial narrative.
Given the mix of optimism and caution in this story, it makes sense to move quickly, review the numbers yourself, then weigh up the 6 key rewards and 3 important warning signs before deciding what it all means for you.