Synchrony +10% on Q4 beat, Sam's Club pact, Walmart resolution

Jan. 23, 2019 7:41 AM ETSynchrony Financial (SYF)By: Liz Kiesche, SA News Editor17 Comments
  • Synchrony Financial (NYSE:SYFjumps 10% in premarket trading after reporting better-than-expected earnings, comes to an agreement extending its partnership with Sam's Club, and Walmart drops its suit against Synchrony.
  • Also agrees to sell Walmart loan portfolio to Capital One (COF).
  • Q4 EPS of $1.09 beats consensus estimate of 91 cents; compares with 91 cents in Q3 and 70 cents in the year-ago period.
  • Q4 purchase volume $40.3B vs $36.4B in Q3 and $36.6B a year ago.
  • Period-end loan receivables growth was 14% and average active account growth of 8% was primarily driven by the PayPal Credit program acquisition and growth.
  • Retail Card period-end loan receivable increased 16%, mostly driven by the PayPay program acquisitions.
  • Q4 net charge-offs of 5.54% of average loan receivables vs. 4.97% in Q3 and 5.78% in the year-ago period; 90+ days past due 2.29% of period-end loan receivables vs. 2.09% in Q3 and 2.28% a year ago.
  • Q4 net interest margin of 16.06% vs. 16.41% in Q3 and 16.24% in Q4 2017.
  • Q4 adjusted return on equity 21.5% vs. 18.5% in Q3 and 14.9% in Q4 2017.
  • Book value per share $20.42 at Dec. 31, 2018  vs. $19.47 at Sept. 30, 2018.
  • Conference call at 8:30 AM ET.
  • Previously: Synchrony Financial beats by $0.18, beats on revenue (Jan. 23)

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