We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Synchrony Financial (SYF - Free Report) reported fourth-quarter 2021 earnings per share of $1.48, which surpassed the Zacks Consensus Estimate of $1.47 by 0.7%. The bottom line improved around 19% year over year.
Results benefited from solid growth in new accounts and a higher purchase volume. However, the same was offset to some extent by steep expenses. It also gained from solid contributions by its Home & Auto, Digital, Diversified & Value, Health & Wellness and Lifestyle businesses.
Synchrony Financial Price, Consensus and EPS Surprise
SYF’s net interest income increased 4.7% year over year to $3.8 billion in the quarter under review.
Other income of $167 million soared 103.7% year over year owing to a venture investment gain.
In the fourth quarter, loan receivables dipped 1.4% year over year to $80.7 billion.
Deposits amounted to $62.3 billion, sliding 1% year over year.
Provision for credit losses plunged 25% year over year to $561 million on the back of lower operational losses.
Total other expenses of $1.1 billion increased 12.2% year over year in the quarter under consideration.
Sales Platforms Update
Home & Auto period-end loan receivables grew 3.3% year over year in the fourth quarter. Purchase volume improved 12.6% year over year owing to consistent sound performances. Interest and fees on loans were up 0.4% year over year.
Digital loan receivables rose 6.5% year over year. Purchase volume climbed 22.2% year over year on the back of robust digital-based partners. Interest and fees on loans increased 5% year over year.
Diversified & Value period-end loan receivables increased 2% year over year on the back of a solid seasonal purchase volume. Purchase volume improved 25.6% year over year in the quarter under review. Interest and fees on loans declined 0.6% year over year.
Health & Wellness period-end loan receivables grew 6.9% year over year while purchase volume advanced 14.2% year over year, highlighting broad based growth across all markets. Interest and fees on loans increased 2.4% year over year.
Lifestyle period-end loan receivables improved 7.5% year over year in the third quarter, courtesy of power sports and music strength. Purchase volume inched up 5.7% year over year. Interest and fees on loans advanced 3.7% year over year.
Financial Position (as of Dec 31, 2021)
SYF exited 2021 with total assets of $95.7 billion, slipping 0.2% year over year.
Total borrowings of $14.5 billion dropped 8% year over year in the quarter under review.
SYF’s balance sheet was consistently strong during the reported quarter with total liquidity of $15.7 billion accounting for 16.4% of its total assets.
Return on assets and return on equity were 3.4% and 23%, respectively, for the fourth quarter.
Efficiency ratio expanded 400 basis points year over year to 41.1%.
Capital Deployment
During the fourth quarter, Synchrony Financial returned capital worth $1.1 billion in the form of share buybacks of $982 million and common stock dividends of $120 million.
Of the finance sector players that have reported fourth-quarter results so far, the bottom-line results of The Travelers Companies, Inc. (TRV - Free Report) and Mastercard Incorporated (MA - Free Report) beat the Zacks Consensus Estimate while that of MarketAxess Holdings Inc. (MKTX - Free Report) missed the same.
See More Zacks Research for These Tickers
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Synchrony Financial's (SYF) Q4 Earnings Beat, Surpass Y/Y
Synchrony Financial (SYF - Free Report) reported fourth-quarter 2021 earnings per share of $1.48, which surpassed the Zacks Consensus Estimate of $1.47 by 0.7%. The bottom line improved around 19% year over year.
Results benefited from solid growth in new accounts and a higher purchase volume. However, the same was offset to some extent by steep expenses. It also gained from solid contributions by its Home & Auto, Digital, Diversified & Value, Health & Wellness and Lifestyle businesses.
Synchrony Financial Price, Consensus and EPS Surprise
Synchrony Financial price-consensus-eps-surprise-chart | Synchrony Financial Quote
Results in Detail
SYF’s net interest income increased 4.7% year over year to $3.8 billion in the quarter under review.
Other income of $167 million soared 103.7% year over year owing to a venture investment gain.
In the fourth quarter, loan receivables dipped 1.4% year over year to $80.7 billion.
Deposits amounted to $62.3 billion, sliding 1% year over year.
Provision for credit losses plunged 25% year over year to $561 million on the back of lower operational losses.
Total other expenses of $1.1 billion increased 12.2% year over year in the quarter under consideration.
Sales Platforms Update
Home & Auto period-end loan receivables grew 3.3% year over year in the fourth quarter. Purchase volume improved 12.6% year over year owing to consistent sound performances. Interest and fees on loans were up 0.4% year over year.
Digital loan receivables rose 6.5% year over year. Purchase volume climbed 22.2% year over year on the back of robust digital-based partners. Interest and fees on loans increased 5% year over year.
Diversified & Value period-end loan receivables increased 2% year over year on the back of a solid seasonal purchase volume. Purchase volume improved 25.6% year over year in the quarter under review. Interest and fees on loans declined 0.6% year over year.
Health & Wellness period-end loan receivables grew 6.9% year over year while purchase volume advanced 14.2% year over year, highlighting broad based growth across all markets. Interest and fees on loans increased 2.4% year over year.
Lifestyle period-end loan receivables improved 7.5% year over year in the third quarter, courtesy of power sports and music strength. Purchase volume inched up 5.7% year over year. Interest and fees on loans advanced 3.7% year over year.
Financial Position (as of Dec 31, 2021)
SYF exited 2021 with total assets of $95.7 billion, slipping 0.2% year over year.
Total borrowings of $14.5 billion dropped 8% year over year in the quarter under review.
SYF’s balance sheet was consistently strong during the reported quarter with total liquidity of $15.7 billion accounting for 16.4% of its total assets.
Return on assets and return on equity were 3.4% and 23%, respectively, for the fourth quarter.
Efficiency ratio expanded 400 basis points year over year to 41.1%.
Capital Deployment
During the fourth quarter, Synchrony Financial returned capital worth $1.1 billion in the form of share buybacks of $982 million and common stock dividends of $120 million.
Zacks Rank
Synchrony Financial currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Releases
Of the finance sector players that have reported fourth-quarter results so far, the bottom-line results of The Travelers Companies, Inc. (TRV - Free Report) and Mastercard Incorporated (MA - Free Report) beat the Zacks Consensus Estimate while that of MarketAxess Holdings Inc. (MKTX - Free Report) missed the same.