Synchrony Q3 Net Income Falls 17% to $892M on Heavier Credit Provision
SYF sits 19% above its 52-week low of $63.08.
Summary
Synchrony earned $892 million, or $2.68 a share, in Q3 — down 17% from a year ago as the provision for credit losses reached $1.27 billion and expenses rose. Net interest income came in at $4.8 billion with a 21% return on common equity and a net interest margin that fell 12 basis points to 15.5%. The quarter follows Q2's 8% earnings decline to $885 million, so the profit contraction is deepening even as net charge-offs improved to 5.43% last quarter. The 8-K filed this morning also showed September delinquencies edging up to 4.3% while charge-offs improved to 4.7%, a mixed credit picture that keeps the provision elevated. Purchase volume rose 8% to $49.7 billion, loan receivables rose 3% to $103.3 billion and average active accounts were flat at 68.3 million, and the company declared a $0.34 dividend. The stock trades near $74.75 with a $24 billion market cap, so a 17% profit drop against a still-large buyback and dividend program is the number that matters for the quarter.
At the time of this announcement, SYF was trading at $74.75 on NYSE in the Finance sector, with a market capitalization of approximately $24.2B. The 52-week trading range was $63.08 to $88.77. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Reuters.