Synchrony Financial SYNCHRONY Bond
| SYF Stock | USD 40.80 1.12 2.82% |
Synchrony Financial has over 15.98 Billion in debt which may indicate that it relies heavily on debt financing. At this time, Synchrony Financial's Debt To Equity is most likely to drop slightly in the upcoming years. The Synchrony Financial's current Debt To Assets is estimated to increase to 0.30, while Long Term Debt is projected to decrease to roughly 13.9 B. Synchrony Financial's financial risk is the risk to Synchrony Financial stockholders that is caused by an increase in debt. In other words, with a high degree of financial leverage come high-interest payments, which usually reduce Earnings Per Share (EPS).
Asset vs Debt
Equity vs Debt
Synchrony Financial's liquidity is one of the most fundamental aspects of both its future profitability and its ability to meet different types of ongoing financial obligations. Synchrony Financial's cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the Company is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps Synchrony Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Synchrony Financial's stakeholders.
For most companies, including Synchrony Financial, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for the executing running Synchrony Financial the most critical issue when dealing with liquidity needs is whether the current assets are properly aligned with its current liabilities. If not, management will need to obtain alternative financing to ensure that there are always enough cash equivalents on the balance sheet in reserve to pay for obligations.
Price Book 1.2484 | Book Value 32.366 | Operating Margin 0.469 | Profit Margin 0.2921 | Return On Assets 0.0202 |
Synchrony |
Given the importance of Synchrony Financial's capital structure, the first step in the capital decision process is for the management of Synchrony Financial to decide how much external capital it will need to raise to operate in a sustainable way. Once the amount of financing is determined, management needs to examine the financial markets to determine the terms in which the company can boost capital. This move is crucial to the process because the market environment may reduce the ability of Synchrony Financial to issue bonds at a reasonable cost.
| Popular Name | Synchrony Financial SYNCHRONY FINL 425 |
| Specialization | Financial Services |
| Equity ISIN Code | US87165B1035 |
| Bond Issue ISIN Code | US87165BAD55 |
| S&P Rating | Others |
| Maturity Date | 15th of August 2024 |
| Issuance Date | 11th of August 2014 |
| Coupon | 4.25 % |
Synchrony Financial Outstanding Bond Obligations
| SYNCHRONY FINL 425 | US87165BAD55 | Details | |
| SYNCHRONY FINL 45 | US87165BAG86 | Details | |
| SYNCHRONY FINL 395 | US87165BAM54 | Details | |
| SYNCHRONY FINL 37 | US87165BAL71 | Details | |
| SYF 4875 13 JUN 25 | US87165BAS25 | Details | |
| SYF 2875 28 OCT 31 | US87165BAR42 | Details | |
| SYF 725 02 FEB 33 | US87165BAU70 | Details |
Understaning Synchrony Financial Use of Financial Leverage
Synchrony Financial financial leverage ratio helps in determining the effect of debt on the overall profitability of the company. It measures Synchrony Financial's total debt position, including all of outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Synchrony Financial assets, the company is considered highly leveraged. Understanding the composition and structure of overall Synchrony Financial debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business and if it is worth investing in it. Financial leverage can amplify the potential profits to Synchrony Financial's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Synchrony Financial's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets).
| Last Reported | Projected for Next Year | ||
| Short and Long Term Debt Total | 16 B | 16.6 B | |
| Net Debt | 1.7 B | 1.6 B | |
| Long Term Debt | 16 B | 13.9 B | |
| Long Term Debt Total | 16.3 B | 17.8 B | |
| Short and Long Term Debt | 675 M | 641.2 M | |
| Short Term Debt | 4.2 B | 4 B | |
| Net Debt To EBITDA | 0.51 | 0.49 | |
| Debt To Equity | 1.45 | 2.44 | |
| Interest Debt Per Share | 56.79 | 28.76 | |
| Debt To Assets | 0.17 | 0.30 | |
| Long Term Debt To Capitalization | 0.53 | 0.69 | |
| Total Debt To Capitalization | 0.59 | 0.72 | |
| Debt Equity Ratio | 1.45 | 2.44 | |
| Debt Ratio | 0.17 | 0.30 | |
| Cash Flow To Debt Ratio | 0.43 | 0.26 |
Synchrony Financial Investors Sentiment
The influence of Synchrony Financial's investor sentiment on the probability of its price appreciation or decline could be a good factor in your decision-making process regarding taking a position in Synchrony. The overall investor sentiment generally increases the direction of a stock movement in a one-year investment horizon. However, the impact of investor sentiment on the entire stock market does not have solid backing from leading economists and market statisticians.
Investor biases related to Synchrony Financial's public news can be used to forecast risks associated with an investment in Synchrony. The trend in average sentiment can be used to explain how an investor holding Synchrony can time the market purely based on public headlines and social activities around Synchrony Financial. Please note that most equities that are difficult to arbitrage are affected by market sentiment the most.
Synchrony Financial's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Synchrony Financial's and other traded tickers. The bigger the bubble, the more accurate is the estimated score. Higher bars for a given day show more participation in the average Synchrony Financial's news discussions. The higher the estimated score, the more favorable is the investor's outlook on Synchrony Financial.
Synchrony Financial Implied Volatility | 64.15 |
Synchrony Financial's implied volatility exposes the market's sentiment of Synchrony Financial stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Synchrony Financial's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Synchrony Financial stock will not fluctuate a lot when Synchrony Financial's options are near their expiration.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Synchrony Financial in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Synchrony Financial's short interest history, or implied volatility extrapolated from Synchrony Financial options trading.
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When determining whether Synchrony Financial is a strong investment it is important to analyze Synchrony Financial's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Synchrony Financial's future performance. For an informed investment choice regarding Synchrony Stock, refer to the following important reports:Check out the analysis of Synchrony Financial Fundamentals Over Time. For more detail on how to invest in Synchrony Stock please use our How to Invest in Synchrony Financial guide.You can also try the Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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When running Synchrony Financial's price analysis, check to measure Synchrony Financial's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Synchrony Financial is operating at the current time. Most of Synchrony Financial's value examination focuses on studying past and present price action to predict the probability of Synchrony Financial's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Synchrony Financial's price. Additionally, you may evaluate how the addition of Synchrony Financial to your portfolios can decrease your overall portfolio volatility.
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Is Synchrony Financial's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Synchrony Financial. If investors know Synchrony will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Synchrony Financial listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth (0.18) | Dividend Share 0.96 | Earnings Share 5.19 | Revenue Per Share 18.191 | Quarterly Revenue Growth (0.02) |
The market value of Synchrony Financial is measured differently than its book value, which is the value of Synchrony that is recorded on the company's balance sheet. Investors also form their own opinion of Synchrony Financial's value that differs from its market value or its book value, called intrinsic value, which is Synchrony Financial's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Synchrony Financial's market value can be influenced by many factors that don't directly affect Synchrony Financial's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Synchrony Financial's value and its price as these two are different measures arrived at by different means. Investors typically determine if Synchrony Financial is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Synchrony Financial's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
What is Financial Leverage?
Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.Leverage and Capital Costs
The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.Benefits of Financial Leverage
Leverage provides the following benefits for companies:- Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
- It provides a variety of financing sources by which the firm can achieve its target earnings.
- Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.