On Thursday, Synovus (NYSE:SNV) Financial Corporation (NYSE:SNV) received an updated price target from Raymond (NS:RYMD) James, now set at $64, increased from the previous $62, while retaining an Outperform rating on the stock. The revision follows the company's fourth quarter 2024 earnings, which surpassed both the firm's forecasts and the consensus on a core basis. According to InvestingPro data, six analysts have recently revised their earnings expectations upward, with price targets ranging from $55 to $68.
Although Synovus shares didn't perform as well today, Raymond James attributes this to the stock's robust year-to-date and fourth quarter 2024 performance, which might have tempered investor enthusiasm. InvestingPro data shows impressive returns of 63.76% over the past year and 25.22% over the last six months. Some investors remain cautious, focusing on the company's potential to produce positive operating leverage in light of an improved net interest margin (NIM) outlook.
Raymond James has adjusted its projections to reflect a modest positive operating leverage for the current year. The firm's earnings per share (EPS) estimates have been increased, taking into account a higher NIM, stronger net interest income (NII), and a greater volume of share repurchases compared to earlier predictions.
The financial services firm is seen to hold a favorable risk-reward balance by Raymond James. This perspective is supported by Synovus' promising profitability outlook, relatively stable credit trends, growing fee income, and the appeal of its market presence and increasing rarity value.
The company's financial health appears to be on solid ground, with expectations of continued strong performance. Notably, InvestingPro analysis indicates the stock is currently undervalued, while highlighting the company's impressive 51-year track record of consecutive dividend payments.
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