Synovus (SNV) AI Stock Analysis

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Synovus

(NYSE:SNV)

67Neutral

Synovus shows strong revenue growth and operational efficiencies but faces challenges in profit margins and cash flow management. The technical analysis suggests potential downward trends, while valuation metrics indicate moderate attractiveness. Positive earnings call sentiment and strategic initiatives support future prospects, balancing the risks and underpinning a moderate overall score.

Positive Factors

Earnings

Synovus Financial shares reported a 4Q24 adjusted EPS beat driven by net interest margin expansion and lower provisions.

Loan Production

Loan commitments production showed the best quarter-over-quarter improvement of the year in 4Q, and is at its highest level in 8 quarters.

Valuation

The stock valuation is seen as attractive with shares trading at a lower P/E ratio compared to SMID-cap peers.

Negative Factors

Expenses

Expense commentary was the largest incremental negative from the conference call, with a faster growth potentially negating positive operating leverage in 2025.

Loan Growth

Shares underperformed after reporting a 4Q24 adj EPS beat, but weaker than expected loan growth.

Operating Leverage

The stock weakness is attributed to profit-taking on an as-expected update and management's hesitation towards committing to positive operating leverage.

Synovus (SNV) vs. S&P 500 (SPY)

Market Cap

$5.77B

Dividend Yield3.74%

Average Volume (3M)2.13M

Price to Earnings (P/E)13.5

Beta (1Y)1.76

Revenue Growth0.83%

EPS Growth-11.72%

CountryUS

Employees4,775

SectorFinancial

Sector Strength85

IndustryBanks - Regional

Share Statistics

EPS (TTM)3.05

Shares Outstanding140,968,660

10 Day Avg. Volume2,219,857

30 Day Avg. Volume2,131,702

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)3.62

Price to Cash Flow (P/CF)6.40

P/FCF Ratio3.20

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$56.75

Price Target Upside40.05% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering10

Synovus Business Overview & Revenue Model

Company DescriptionSynovus Financial Corp. operates as the bank holding company for Synovus Bank that provides commercial and retail banking products and services. It operates through three segments: Community Banking, Wholesale Banking, and Financial Management Services. The company's commercial banking services include treasury management, asset management, capital market, and institutional trust services, as well as commercial, financial, and real estate loans. Its retail banking services comprise accepting customary types of demand and savings deposits accounts; mortgage, installment, and other consumer loans; investment and brokerage services; safe deposit services; automated banking services; automated fund transfers; Internet-based banking services; and bank credit and debit card services. The company also offers various other financial services, including portfolio management for fixed-income securities, investment banking, execution of securities transactions as a broker/dealer, and financial planning services, as well as provides individual investment advice on equity and other securities. As of December 31, 2020, it operated through 289 branches and 389 ATMs in Alabama, Florida, Georgia, South Carolina, and Tennessee. The company was founded in 1888 and is headquartered in Columbus, Georgia.

How the Company Makes MoneySynovus generates revenue primarily through interest income from loans and investment securities, as well as from fees and service charges related to its banking operations. The company's key revenue streams include interest earned on commercial and consumer loans, interest from investment securities, and non-interest income from fees for services such as asset management, deposit account services, and transaction processing. Synovus also benefits from strategic partnerships and collaborations with financial technology providers to enhance its product offerings and service delivery, further contributing to its revenue.

Synovus Financial Statement Overview

Summary

Synovus shows robust revenue growth and operational efficiency improvements, but faces challenges with declining net profit margins and increased leverage. The balance sheet reflects a stable capital structure, but lower returns on equity. Cash flow management remains a concern due to decreased operating cash flows, impacting financial flexibility.

Income Statement

Positive

Synovus has demonstrated strong revenue growth, with Total Revenue increasing significantly from $2.03 billion in 2023 to $3.19 billion in 2024. The Gross Profit Margin remained consistent at 100% due to the nature of banking operations. However, the Net Profit Margin decreased to 15.1% in 2024 from 26.7% in 2023, indicating increased expenses or lower profitability. EBIT Margin improved considerably, reflecting better operational efficiency.

Balance Sheet

Positive

The company's Debt-to-Equity ratio increased, indicating higher leverage. However, Synovus maintains a solid Equity Ratio of 8.7%, suggesting stable capital structure but relatively low equity compared to total assets. The Return on Equity (ROE) decreased to 9.2% in 2024 from 10.6% in 2023, suggesting lowered returns to shareholders.

Cash Flow

Neutral

Operating Cash Flow decreased significantly from $1.28 billion in 2023 to $419.9 million in 2024, impacting overall cash flow stability. The Free Cash Flow to Net Income Ratio was favorable at 0.87, indicating efficient cash generation relative to net income. However, the Free Cash Flow Growth Rate was negative, reflecting declining free cash flow over the period.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
3.19B	2.03B	2.21B	1.98B	2.02B
	Gross Profit
3.19B	1.72B	1.88B	1.68B	1.71B
	EBIT
3.15B	998.21M	1.24B	989.36M	484.67M
	EBITDA
0.00	0.00	1.03B	1.10B	554.29M
	Net Income Common Stockholders
482.46M	543.71M	757.90M	760.47M	373.69M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.56B	12.20B	11.62B	13.86B	12.10B
	Total Assets
60.23B	59.81B	59.73B	57.32B	54.37B
	Total Debt
1.86B	1.23B	4.71B	1.20B	1.21B
	Net Debt
-1.11B	-1.18B	2.77B	-1.73B	-2.93B
	Total Liabilities
54.97B	54.67B	55.26B	52.02B	49.20B
	Stockholders Equity
5.24B	5.12B	4.48B	5.30B	5.16B
Cash Flow		Free Cash Flow
419.94M	1.25B	1.16B	768.06M	-13.07M
	Operating Cash Flow
419.94M	1.28B	1.19B	794.02M	17.03M
	Investing Cash Flow
-101.63M	323.97M	-4.86B	-4.38B	-2.35B
	Financing Cash Flow
-36.38M	-1.13B	2.63B	2.35B	5.40B

Synovus Technical Analysis

Technical Analysis Sentiment

Negative

Last Price40.52

Price Trends

50DMA

47.66

Negative

100DMA

50.66

Negative

200DMA

47.84

Negative

Market Momentum

MACD

-2.23

Positive

RSI

40.06

Neutral

STOCH

54.64

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SNV, the sentiment is Negative. The current price of 40.52 is below the 20-day moving average (MA) of 43.62, below the 50-day MA of 47.66, and below the 200-day MA of 47.84, indicating a bearish trend. The MACD of -2.23 indicates Positive momentum. The RSI at 40.06 is Neutral, neither overbought nor oversold. The STOCH value of 54.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SNV.

Synovus Risk Analysis

Synovus disclosed 36 risk factors in its most recent earnings report. Synovus reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Synovus Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HOMB	76 Outperform	$5.01B	12.55	10.38%	2.97%	8.83%	3.77%
CADE	71 Outperform	$5.12B	10.12	9.75%	3.66%	26.65%	-3.60%
BOKF	68 Neutral	$5.86B	11.21	9.70%	2.46%	11.17%	1.47%
ONB	67 Neutral	$6.22B	11.58	9.06%	2.87%	16.39%	-13.25%
SNV	67 Neutral	$5.77B	13.51	9.31%	3.74%	0.83%	-11.72%
BPOP	65 Neutral	$5.86B	9.87	11.42%	3.13%	13.68%	13.73%
Sector *	63 Neutral	$12.75B	9.36	8.64%	84.32%	13.82%	-3.89%

* Financial Sector Average

Performance Comparison

SNV

Synovus

40.52

7.77

23.73%

CADE

Cadence Bank

27.89

2.39

9.37%

BOKF

Bok Financial

90.81

7.20

8.61%

HOMB

Home Bancshares

25.98

3.39

15.01%

ONB

Old National Bancorp Capital

19.46

4.12

26.86%

BPOP

Popular

83.90

4.36

5.48%

Synovus Earnings Call Summary

Earnings Call Date: Apr 16, 2025 | % Change Since: 0.00% | Next Earnings Date: Jul 22, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted strong earnings growth, net interest margin expansion, and improved credit performance as key positives. However, the company faces challenges with increased negative sentiment among clients and potential impacts from tariffs and economic uncertainty. The decline in adjusted non-interest revenue also poses concerns.

Highlights

Strong Earnings Growth

Synovus reported GAAP and adjusted earnings per share of $1.30, with adjusted earnings per share increasing 4% from the previous quarter and 65% year-over-year. Excluding the FDIC special assessment, adjusted earnings per share rose 53%.

Net Interest Margin Expansion

Net interest margin expanded to 3.35%, up 7 basis points from the previous quarter, driven by effective deposit repricing and a stable Fed funds environment.

Loan Production and Growth

Funded loan production was the highest since Q4 2022, leading to loan growth of $40 million. Lending momentum accelerated with 8% annualized growth in high-growth segments.

Improved Credit Performance

Net charge-offs declined to 20 basis points, with improvement in broad-based credit metrics. Non-performing loans improved to 0.67% of total loans.

Capital and Liquidity Position

Common equity Tier 1 ratio was 10.75% and total risk-based capital was 13.65%. The company also completed $120 million of share repurchases in Q1.

Lowlights

Increased Negative Sentiment Among Clients

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.

Impact of Tariffs and Economic Uncertainty

20% of clients felt increased tariffs would have a meaningful impact on their businesses, contributing to concerns about the economic environment.

Decline in Adjusted Non-Interest Revenue

Adjusted non-interest revenue was $117 million, declining 6% sequentially, impacted by loan production mix and lower seasonal and transaction-related wealth management income.

Company Guidance

During the Synovus First Quarter 2025 earnings call, the company provided robust guidance, highlighting several key metrics. Synovus reported a GAAP and adjusted earnings per share of $1.30, with adjusted earnings per share increasing by 4% from the previous quarter and 65% year-over-year. Excluding the FDIC special assessment, the adjusted earnings per share increased 53%. The company achieved a net interest margin of 3.35%, up 7 basis points from the prior quarter, driven by effective deposit repricing and a stable Fed funds environment. Loan growth was reported at $40 million for the quarter, with funded loan production reaching the highest level since Q4 2022. Net charge-offs declined to 20 basis points, and the adjusted return on tangible equity rose to 17.6%. Guidance for 2025 includes anticipated loan growth of 3% to 5% and core deposit growth of 3% to 5%, with an adjusted revenue growth outlook of 3% to 6%. The company also expects adjusted non-interest revenue between $485 million and $505 million and projects adjusted non-interest expense growth of 2% to 4%. Net charge-offs are expected to remain stable sequentially, and the tax rate is projected to be stable at 22%. Synovus emphasized its strategic initiatives and confidence in long-term growth, despite uncertainties arising from economic conditions and potential policy changes.

Synovus Corporate Events

Business Operations and StrategyFinancial Disclosures

Synovus Reports Strong Q4 2024 Earnings Growth

Positive

Jan 15, 2025

On January 15, 2025, Synovus announced its financial results for Q4 2024 and the full year. The company reported a significant increase in diluted earnings per share to $1.25 from $0.41 in the same quarter of the previous year, driven by relationship-building strategies and strict cost control. Despite a decline in net income and net interest income for the year, Synovus saw an improvement in credit quality and maintained a robust CET1 ratio. The company also experienced growth in core deposits and adjusted non-interest revenue, positioning itself for continued success in 2025.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.