Contrasting Synchrony Financial (SYF) & TPG RE Finance Trust (TRTX)

Synchrony Financial (NYSE: SYF) and TPG RE Finance Trust (NYSE:TRTX) are both financials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, dividends, profitability, earnings and risk.

Dividends

Synchrony Financial pays an annual dividend of $0.60 per share and has a dividend yield of 1.6%. TPG RE Finance Trust pays an annual dividend of $0.71 per share and has a dividend yield of 3.8%. Synchrony Financial pays out 24.8% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares Synchrony Financial and TPG RE Finance Trust’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Synchrony Financial $16.70 billion 1.79 $1.94 billion $2.42 15.98
TPG RE Finance Trust $92.39 million 12.11 $69.96 million N/A N/A

Synchrony Financial has higher revenue and earnings than TPG RE Finance Trust.

Profitability

This table compares Synchrony Financial and TPG RE Finance Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Synchrony Financial 11.75% 14.62% 2.27%
TPG RE Finance Trust N/A N/A N/A

Analyst Recommendations

This is a summary of current ratings and recommmendations for Synchrony Financial and TPG RE Finance Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Synchrony Financial 0 8 11 0 2.58
TPG RE Finance Trust 0 2 3 0 2.60

Synchrony Financial currently has a consensus target price of $37.71, suggesting a potential downside of 2.52%. TPG RE Finance Trust has a consensus target price of $21.20, suggesting a potential upside of 12.95%. Given TPG RE Finance Trust’s stronger consensus rating and higher possible upside, analysts clearly believe TPG RE Finance Trust is more favorable than Synchrony Financial.

Insider and Institutional Ownership

87.0% of Synchrony Financial shares are owned by institutional investors. Comparatively, 26.4% of TPG RE Finance Trust shares are owned by institutional investors. 0.0% of Synchrony Financial shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Synchrony Financial beats TPG RE Finance Trust on 8 of the 13 factors compared between the two stocks.

About Synchrony Financial

Synchrony Financial is a consumer financial services company. The Company provides a range of credit products through programs it has established with a group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and healthcare service providers. The Company’s revenue activities are managed through three sales platforms: Retail Card, Payment Solutions and CareCredit. It offers its credit products through its subsidiary, Synchrony Bank (the Bank). Through the Bank, it offers a range of deposit products insured by the Federal Deposit Insurance Corporation (FDIC), including certificates of deposit, individual retirement accounts (IRAs), money market accounts and savings accounts. The Company offers three types of credit products: credit cards, commercial credit products and consumer installment loans. The Company also offers a debt cancellation product. It offers two types of credit cards: private label credit cards and Dual Cards.

About TPG RE Finance Trust

TPG RE Finance Trust, Inc. is a commercial real estate finance company. The Company is engaged in originating, acquiring and managing commercial mortgage loans and other commercial real estate-related debt instruments. It focuses primarily on directly originating and selectively acquiring floating rate first mortgage loans that are secured by high quality commercial real estate properties undergoing some form of transition and value creation, such as re-tenanting, refurbishment or other form of repositioning. As of December 31, 2016, the Company’s portfolio consisted of 54 first mortgage loans. As of December 31, 2016, 97% of the loan commitments in its portfolio consisted of floating rate loans, and 98.6% of the loan commitments in its portfolio consisted of first mortgage loans.

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