On Thursday, Keefe, Bruyette & Woods, a brokerage firm, raised its rating on shares of Synchrony Financial (NYSE:SYF), from Market Perform to Outperform, and increased the price target to $62 from the previous $45. This adjustment reflects a more optimistic outlook for the private label credit card issuer following recent legal developments and regulatory clarifications.
The brokerage firm's decision comes amidst a changing landscape for the financial industry, particularly concerning late fee regulations which have been a point of uncertainty for credit card issuers. The analyst noted that the perceived risks associated with these regulations are receding, which has led to a reassessment of the stock's prospects.
According to the firm, even under conservative estimates, the potential for Synchrony Financial's stock to appreciate is substantial, providing what they consider sufficient reward for the risks involved. This positive reassessment is based on both the diminishing regulatory concerns and favorable outcomes in recent court proceedings.
The revised price target of $62 represents a significant increase from the prior target of $45, signaling the firm's confidence in the stock's future performance. The upgrade to Outperform suggests that the firm believes Synchrony Financial will outpace the average returns of the market or its sector in the foreseeable future.
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