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Can Synchrony Beat Q3 Earnings Estimates on Improving Margins?
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Key Takeaways
Synchrony is set to report Q3 results Oct. 15, with estimates at $2.16 EPS on $4.7B in revenues.
Higher net interest margin and reduced charge-offs may lift Synchrony's quarterly results.
Increased costs and softer purchase volumes could partially offset Synchrony's Q3 gains.
Consumer financial services company, Synchrony Financial (SYF - Free Report) , is set to report third-quarter 2025 results on Oct. 15, before the opening bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at $2.16 per shareon revenues of $4.7 billion.
The third-quarter earnings estimate has remained stable over the past week. The bottom-line projection indicates a year-over-year increase of 11.3%. The Zacks Consensus Estimate for quarterly revenues implies year-over-year growth of 2%.
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For the full-year 2025, the Zacks Consensus Estimate for Synchrony’s revenues is pegged at $18.54 billion, implying a rise of 3% year over year. Also, the consensus mark for the current year EPS is pegged at $8.35, signaling a jump of around 26.7% on a year-over-year basis.
SYF’s earnings beat the consensus estimate in each of the last four quarters, with the average surprise being 17.9%.
Our proven model predicts a likely earnings beat for the company this time around as well. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is precisely the case here.
Synchronyhas an Earnings ESP of +5.07% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
What’s Shaping SYF’s Q3 Results?
Synchrony is expected to have seen advantages in the third quarter from increased net interest margin and lower provision for credit losses. The net charge-offs are also likely to have substantially decreased in the quarter under review. Our model predicts interest and fees on loans of $5.5 billion for the quarter, relatively flat year over year. Higher figures from Health & Wellness are likely to have anchored the results.
The Zacks Consensus Estimate for net interest margin is pegged at 15.35%, up from 15.04% achieved a year ago, increasing its profitability.
The consensus mark for the net charge-offsratio is pegged at 5.39, down from 6.06 a year ago. The above-mentioned factors are likely to have benefited the company in the third quarter, positioning it for not only year-over-year growth but also an earnings beat. However, Synchrony is expected to have incurred increased information processing and employee costs in the third quarter and witnessed lower purchase volumes, partially offsetting the positives.
Both the Zacks Consensus Estimate and our model estimate indicate that the total average active accounts are likely to decline 2.3% in the third quarter. The financial service provider is expected to have witnessed a marginal decrease in Average Interest-Earning Assets. The consensus estimate indicates a 0.2% decline in the metric from the year-ago period.
The Zacks Consensus Estimate indicates that purchase volumes are likely to decline marginally in the third quarter, whereas our model estimate suggests a 1.1% fall, due to selective consumer spending and credit actions. The Zacks Consensus Estimate for the efficiency ratio is pegged at 32.06%, indicating a deterioration from the prior-year reported figure of 31.20%.
Other Stocks That Warrant a Look
Here are some other companies worth considering from the broader Finance space, as our model shows that these, too, have the right combination of elements to beat on earnings this time around:
The Zacks Consensus Estimate for Bridgewater’s bottom line for the to-be-reported quarter is pegged at 41 cents per share, which remained stable over the past week. The consensus estimate for Bridgewater’s revenues is pegged at $37.1 million.
Ameriprise Financial, Inc. (AMP - Free Report) has an Earnings ESP of +3.38% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Ameriprise Financial’s bottom line for the to-be-reported quarter is pegged at $9.55 per share, which indicates 8.2% year-over-year growth. The consensus estimate for Ameriprise Financial’s revenues is pegged at $4.51 billion, a 3.6% increase from a year ago.
American Express Company (AXP - Free Report) has an Earnings ESP of +0.97% and a Zacks Rank of 3.
The Zacks Consensus Estimate for American Express’ bottom line for the to-be-reported quarter is pegged at $3.95 per share, a 13.2% jump from a year ago. The consensus estimate for American Express’ revenues is pegged at $18 billion, an 8.2% year-over-year jump.
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Can Synchrony Beat Q3 Earnings Estimates on Improving Margins?
Key Takeaways
Consumer financial services company, Synchrony Financial (SYF - Free Report) , is set to report third-quarter 2025 results on Oct. 15, before the opening bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at $2.16 per shareon revenues of $4.7 billion.
The third-quarter earnings estimate has remained stable over the past week. The bottom-line projection indicates a year-over-year increase of 11.3%. The Zacks Consensus Estimate for quarterly revenues implies year-over-year growth of 2%.
For the full-year 2025, the Zacks Consensus Estimate for Synchrony’s revenues is pegged at $18.54 billion, implying a rise of 3% year over year. Also, the consensus mark for the current year EPS is pegged at $8.35, signaling a jump of around 26.7% on a year-over-year basis.
SYF’s earnings beat the consensus estimate in each of the last four quarters, with the average surprise being 17.9%.
Synchrony Financial Price and EPS Surprise
Synchrony Financial price-eps-surprise | Synchrony Financial Quote
Q3 Earnings Whispers for SYF
Our proven model predicts a likely earnings beat for the company this time around as well. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is precisely the case here.
Synchronyhas an Earnings ESP of +5.07% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
What’s Shaping SYF’s Q3 Results?
Synchrony is expected to have seen advantages in the third quarter from increased net interest margin and lower provision for credit losses. The net charge-offs are also likely to have substantially decreased in the quarter under review. Our model predicts interest and fees on loans of $5.5 billion for the quarter, relatively flat year over year. Higher figures from Health & Wellness are likely to have anchored the results.
The Zacks Consensus Estimate for net interest margin is pegged at 15.35%, up from 15.04% achieved a year ago, increasing its profitability.
The consensus mark for the net charge-offs ratio is pegged at 5.39, down from 6.06 a year ago. The above-mentioned factors are likely to have benefited the company in the third quarter, positioning it for not only year-over-year growth but also an earnings beat. However, Synchrony is expected to have incurred increased information processing and employee costs in the third quarter and witnessed lower purchase volumes, partially offsetting the positives.
Both the Zacks Consensus Estimate and our model estimate indicate that the total average active accounts are likely to decline 2.3% in the third quarter. The financial service provider is expected to have witnessed a marginal decrease in Average Interest-Earning Assets. The consensus estimate indicates a 0.2% decline in the metric from the year-ago period.
The Zacks Consensus Estimate indicates that purchase volumes are likely to decline marginally in the third quarter, whereas our model estimate suggests a 1.1% fall, due to selective consumer spending and credit actions. The Zacks Consensus Estimate for the efficiency ratio is pegged at 32.06%, indicating a deterioration from the prior-year reported figure of 31.20%.
Other Stocks That Warrant a Look
Here are some other companies worth considering from the broader Finance space, as our model shows that these, too, have the right combination of elements to beat on earnings this time around:
Bridgewater Bancshares, Inc. (BWB - Free Report) has an Earnings ESP of +4.88% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Bridgewater’s bottom line for the to-be-reported quarter is pegged at 41 cents per share, which remained stable over the past week. The consensus estimate for Bridgewater’s revenues is pegged at $37.1 million.
Ameriprise Financial, Inc. (AMP - Free Report) has an Earnings ESP of +3.38% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Ameriprise Financial’s bottom line for the to-be-reported quarter is pegged at $9.55 per share, which indicates 8.2% year-over-year growth. The consensus estimate for Ameriprise Financial’s revenues is pegged at $4.51 billion, a 3.6% increase from a year ago.
American Express Company (AXP - Free Report) has an Earnings ESP of +0.97% and a Zacks Rank of 3.
The Zacks Consensus Estimate for American Express’ bottom line for the to-be-reported quarter is pegged at $3.95 per share, a 13.2% jump from a year ago. The consensus estimate for American Express’ revenues is pegged at $18 billion, an 8.2% year-over-year jump.