Update shared on23 Oct 2025
Fair value Decreased 2.35%Analysts have modestly reduced their price target for Synovus Financial, lowering the fair value estimate by approximately $1.36 to reflect updated revenue growth assumptions, a slightly lower discount rate, and the impact of the pending Pinnacle merger.
Analyst Commentary
Recent updates from Street analysts reflect a shifting outlook for Synovus Financial amid the pending merger with Pinnacle Financial. Price targets have generally trended lower, with several analysts adjusting their models and recommendations based on evolving revenue trends, merger execution risks, and changes to projected interest rate environments.
Bullish Takeaways
- Bullish analysts maintain Buy or Outperform ratings based on expectations for core revenue improvements. Recent quarters have shown solid performance and stable credit quality.
- Some bullish updates cite margin stability and continued strength in core franchise metrics. Near-term interest rate reductions are expected to pose challenges, but the outlook remains positive.
- Despite modestly lowered price targets, there is optimism regarding the medium-term earnings outlook. Integration with Pinnacle could unlock additional scale and expansion opportunities.
Bearish Takeaways
- Bearish analysts have highlighted execution risk with the Pinnacle merger, including the complexity of integrating two large institutions and the extended timeline to full conversion.
- Recent valuation cuts also reflect concerns about Synovus’s heightened asset sensitivity and the potential pressure on net interest margins if rates decline further.
- Some have downgraded the stock or moved to more neutral stances, emphasizing risks tied to regional banking sector volatility and uncertainties around the merger's final terms and outcomes.
- There are additional reservations regarding the sudden creation of a much larger bank entity. Worries include potential operational disruption and necessary balance sheet adjustments post-merger.
What's in the News
- Synovus Financial has scheduled a Special or Extraordinary Shareholders Meeting for November 6, 2025 (Key Developments).
Valuation Changes
- Fair Value: Lowered modestly from $57.79 to $56.43, reflecting adjustments to key assumptions.
- Discount Rate: Decreased slightly from 7.10% to 6.92%, indicating a marginally lower risk premium.
- Revenue Growth: Trimmed from 6.56% to 6.26% based on more conservative projections.
- Net Profit Margin: Edged higher from 29.49% to 29.72% signifying improved profitability expectations.
- Future P/E: Reduced from 11.55x to 10.97x, suggesting a slightly lower valuation on projected earnings.
Disclaimer
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