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"We rate SYNOVUS FINANCIAL CORP (SNV) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, growth in earnings per share, increase in stock price during the past year and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
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Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for SYNOVUS FINANCIAL CORP is currently very high, coming in at 89.58%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 15.73% trails the industry average.
- SYNOVUS FINANCIAL CORP has improved earnings per share by 14.3% 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 ($1.32 versus $0.91).
- SNV, with its decline in revenue, slightly underperformed the industry average of 4.8%. Since the same quarter one year prior, revenues slightly dropped by 0.0%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Commercial Banks industry average. The net income increased by 2.4% when compared to the same quarter one year prior, going from $45.70 million to $46.79 million.
- The stock price has risen over the past year, but, despite its earnings growth and some other positive factors, it has underperformed the S&P 500 so far. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- You can view the full analysis from the report here: SNV Ratings Report