Jefferies has commenced coverage of Synovus (SNV, Financial), assigning it a Hold rating and setting a price target of $55. The firm has initiated evaluations for 32 regional and mid-cap banks, expressing a generally positive outlook for the sector. Despite some uncertainties related to tariffs, factors such as a rebound in loan growth as the U.S. steers clear of a recession, expansion in net interest margins due to a steeper yield curve, and resilient credit metrics are seen as potential advantages for these banks. Additionally, the presence of excess capital offers strategic flexibility, and valuations are considered appealing. These elements are highlighted in a recent analyst note.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 16 analysts, the average target price for Synovus Financial Corp (SNV, Financial) is $55.00 with a high estimate of $64.00 and a low estimate of $46.00. The average target implies an upside of 12.52% from the current price of $48.88. More detailed estimate data can be found on the Synovus Financial Corp (SNV) Forecast page.
Based on the consensus recommendation from 17 brokerage firms, Synovus Financial Corp's (SNV, Financial) average brokerage recommendation is currently 2.2, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Synovus Financial Corp (SNV, Financial) in one year is $46.52, suggesting a downside of 4.83% from the current price of $48.88. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Synovus Financial Corp (SNV) Summary page.
SNV Key Business Developments
Release Date: April 17, 2025
- Earnings Per Share (EPS): GAAP and adjusted EPS of $1.30; adjusted EPS increased 4% from the previous quarter and 65% year-over-year.
- Net Interest Income: $454 million, up 8% year-over-year and flat sequentially.
- Net Interest Margin: 3.35%, up 7 basis points from the previous quarter.
- Loan Growth: Loan balances increased by $40 million; funded loan production increased 16% quarter-over-quarter and 89% year-over-year.
- Core Deposits: Increased 3% year-over-year.
- Cost of Deposits: Average cost declined 20 basis points to 2.26%.
- Adjusted Non-Interest Revenue: $117 million, declined 6% sequentially and increased 1% year-over-year.
- Adjusted Non-Interest Expense: Flat sequentially and down 3% year-over-year.
- Net Charge-Offs: $21 million or 20 basis points, below the expected range of 25 to 35 basis points.
- Non-Performing Loans: Improved to 0.67% of total loans, down from 0.73% in the previous quarter.
- Allowance for Credit Losses: 1.24%, down from 1.27% at the end of 2024.
- Common Equity Tier 1 Ratio: 10.75%.
- Total Risk-Based Capital: 13.65%.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Synovus Financial Corp (SNV, Financial) reported strong first-quarter 2025 results with GAAP and adjusted earnings per share of $1.30, marking a 65% year-over-year increase.
- Net interest margin expanded to 3.35%, up 7 basis points from the previous quarter, driven by effective deposit repricing and stable fed funds environment.
- Loan production was the highest since the fourth quarter of 2022, with funded production increasing 16% quarter-over-quarter and 89% year-over-year.
- Core deposits increased 3% year-over-year, with positive trends in money market, interest-bearing demand, and savings accounts.
- The company maintained a strong capital position with a preliminary Common Equity Tier 1 ratio at 10.75% and completed $120 million of share repurchases in the first quarter.
Negative Points
- There was an increase in negative sentiment among commercial clients, with 17% expecting business activity to decline over the next 12 months, up from 10% last quarter.
- The company faces uncertainty due to recent tariff policy announcements, impacting client sentiment and potentially affecting economic growth.
- Adjusted non-interest revenue declined 6% sequentially, with lower commercial sponsorship income and softer capital market fees.
- The allowance for credit losses declined due to positive credit trends but was partially offset by a more adverse economic outlook.
- Loan growth was relatively muted, with only a $40 million increase in period-end loan balances, despite strong loan production trends.
