Synchrony Financial Valuation

Is SYF.PRB undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of SYF.PRB when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: SYF.PRB ($26.1) is trading below our estimate of fair value ($47.07)

Significantly Below Fair Value: SYF.PRB is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SYF.PRB?

Key metric: As SYF.PRB is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for SYF.PRB. This is calculated by dividing SYF.PRB's market cap by their current earnings.
What is SYF.PRB's PE Ratio?
PE Ratio	8x
Earnings	US$3.10b
Market Cap	US$25.30b

SYF.PRB key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	-1x

Price to Earnings Ratio vs Peers

How does SYF.PRB's PE Ratio compare to its peers?

The above table shows the PE ratio for SYF.PRB vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	14x
DFS Discover Financial Services	14x	3.8%	US$44.2b
ALLY Ally Financial	14x	28.4%	US$11.0b
COF Capital One Financial	17.2x	15.2%	US$70.6b
KSPI Kaspi.kz	10.7x	23.7%	US$20.9b
SYF.PRB Synchrony Financial	8x	-8.4%	US$25.3b

Price-To-Earnings vs Peers: SYF.PRB is good value based on its Price-To-Earnings Ratio (8x) compared to the peer average (14x).

Price to Earnings Ratio vs Industry

How does SYF.PRB's PE Ratio compare vs other companies in the US Consumer Finance Industry?

2 Companies	Price / Earnings	Estimated Growth	Market Cap
YRD Yiren Digital	1.8x	n/a	US$507.70m
XYF X Financial	1.7x	n/a	US$302.56m

No more companies available in this PE range

2 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: SYF.PRB is good value based on its Price-To-Earnings Ratio (8x) compared to the US Consumer Finance industry average (12.3x).

Price to Earnings Ratio vs Fair Ratio

What is SYF.PRB's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SYF.PRB PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	8x
Fair PE Ratio	14x

Price-To-Earnings vs Fair Ratio: SYF.PRB is good value based on its Price-To-Earnings Ratio (8x) compared to the estimated Fair Price-To-Earnings Ratio (14.1x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

Discover undervalued companies

FinVolution Group

US$1.5b

Operates in the online consumer finance industry.

FINV

US$5.94

-3.7%

15.6%

Federal Home Loan Mortgage

US$9.7b

Operates in the secondary mortgage market in the United States.

FMCC

US$3.00

35.7%

376.1%

VEF

SEK 2.4b

A venture capital firm specializing in early venture, emerging growth and growth capital investments.

VEFF.F

SEK 0.20

n/a