Synchrony Financial to Repurchase Stock Worth $2.9B

Synchrony Financial (SYF) announced its plan to repurchase up to $2.9 billion worth of its shares. Shares of the premier consumer financial services company have jumped 137.5% over the past year.

The repurchase offer is subject to certain regulatory approvals and is valid from April 1, 2021, to June 30, 2022. (See Synchrony Financial stock analysis on TipRanks)

This program replaces the company’s previously announced share repurchase authorization worth $1.6 billion announced on January 26, 2021.

In addition, the company reaffirmed that it will continue to pay out a quarterly dividend of $0.22 per share.

Management said that the announced program does not include the impact of any capital released if the Loan Receivables associated with the Gap program are sold at the expiration of the existing program.

On April 28, following the company’s Q1 results, Oppenheimer analyst Dominick Gabriele reiterated a Hold rating and did not assign a price target to the stock.

Gabriele commented, “SYF is in a strong competitive position, given its recent renewals. Barring COVID-19, we see a clear EPS trajectory and improving profitability without pressure from a pending renewal.”

Overall, the stock has a Strong Buy consensus rating based on 10 Buys and 1 Hold. The average analyst price target of $51.56 implies 11.5% upside potential from current levels.

Synchrony Financial scores a 9 on 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

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