NEW YORK (TheStreet) -- Drexel Hamilton upgraded Synovus (SNV) to "buy" from "hold," set a $29 price target and increased its estimates. The firm cited above-average growth potential as the reason for the moves.
The stock closed at $24.25 on Monday.
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Separately, TheStreet Ratings team rates SYNOVUS FINANCIAL CORP as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate SYNOVUS FINANCIAL CORP (SNV) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 63.7% when compared to the same quarter one year prior, rising from $29.57 million to $48.42 million.
- The gross profit margin for SYNOVUS FINANCIAL CORP is currently very high, coming in at 87.23%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, SNV's net profit margin of 16.53% significantly trails the industry average.
- SYNOVUS FINANCIAL CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, SYNOVUS FINANCIAL CORP reported lower earnings of $0.91 versus $5.95 in the prior year. This year, the market expects an improvement in earnings ($1.44 versus $0.91).
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. When compared to other companies in the Commercial Banks industry and the overall market, SYNOVUS FINANCIAL CORP's return on equity is below that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to $87.27 million or 51.18% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, SYNOVUS FINANCIAL CORP has marginally lower results.
- You can view the full analysis from the report here: SNV Ratings Report