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Synchrony (SYF) & Belk Expand Partnership to Offer BNPL Options

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Synchrony Financial (SYF - Free Report) recently announced that the company has expanded its partnership with regional department store chain Belk to provide customers flexibility in purchasing through its buy now, pay later (BNPL) option.

Belk will leverage Synchrony SetPay monthly, along with its Belk+ Rewards suite of credit cards, to provide another payment option to consumers. Customers are expected to make fixed payments every month for their purchases. Belk has a strong e-commerce presence and a physical presence in 300 locations in 16 southeastern states.

The move strengthens Synchrony Financial's partnership with Belk of 16 years. SYF is the provider of Belk+ Rewards credit cards. The latest SetPay payment product is launched for Belk’s furniture and appliance departments. Moves like this enable SYF to grow traffic in its network and diversify its business.

With high inflation in the domestic market, demand for different payment options like BNPL is on the rise. Strengthening alliances with companies like Belk will allow SYF to grow its purchase volume over time and boost its loan receivables. Its total purchase volume for the third quarter jumped 6.3% year over year to $44,557 million.

For the third quarter, total loan receivables increased 13% year over year to $86 billion and beat our estimate of $82 billion. Synchrony Financial expects around 12% loan receivables growth for 2022 due to underlying trends of payment rates and high purchase volume strength.

Price Performances

Shares of Synchrony Financial have declined 27.2% in the past year compared with the industry’s 24.7% fall.

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Zacks Rank & Key Picks

Synchrony Financial currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader finance space are American Financial Group, Inc. (AFG - Free Report) , StoneX Group Inc. (SNEX - Free Report) and Midwest Holding Inc. , all carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Headquartered in Cincinnati, OH, American Financial is a major insurance holding company. The Zacks Consensus Estimate for AFG’s 2022 bottom line is pegged at $11.66 per share, which witnessed two upward estimate revisions in the past 60 days against none in the opposite direction.

New York-based StoneX Group works as a global financial services network. The Zacks Consensus Estimate for SNEX’s current year bottom line indicates 54.8% year-over-year growth.

Based in Lincoln, NE, Midwest Holding is a financial services company. The Zacks Consensus Estimate for MDWT’s 2022 earnings is pegged at 65 cents per share, signaling a 185.5% surge from a year ago.


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