PHH Corp (PHH) & Synchrony Financial (SYF) Critical Comparison
PHH Corp (NYSE: PHH) and Synchrony Financial (NYSE:SYF) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, profitability, risk, analyst recommendations and dividends.
This is a breakdown of recent recommendations for PHH Corp and Synchrony Financial, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PHH Corp currently has a consensus price target of $16.25, indicating a potential upside of 14.04%. Synchrony Financial has a consensus price target of $37.23, indicating a potential upside of 20.39%. Given Synchrony Financial’s stronger consensus rating and higher possible upside, analysts clearly believe Synchrony Financial is more favorable than PHH Corp.
This table compares PHH Corp and Synchrony Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Synchrony Financial pays an annual dividend of $0.60 per share and has a dividend yield of 1.9%. PHH Corp does not pay a dividend. Synchrony Financial pays out 22.6% of its earnings in the form of a dividend.
Volatility and Risk
PHH Corp has a beta of 1.92, suggesting that its share price is 92% more volatile than the S&P 500. Comparatively, Synchrony Financial has a beta of 1.01, suggesting that its share price is 1% more volatile than the S&P 500.
Insider & Institutional Ownership
98.1% of PHH Corp shares are held by institutional investors. Comparatively, 87.2% of Synchrony Financial shares are held by institutional investors. 2.5% of PHH Corp shares are held by company insiders. Comparatively, 0.0% of Synchrony Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares PHH Corp and Synchrony Financial’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|PHH Corp||$734.00 million||1.00||-$261.66 million||($5.10)||-2.79|
|Synchrony Financial||$7.04 billion||3.49||$2.11 billion||$2.65||11.67|
Synchrony Financial has higher revenue and earnings than PHH Corp. PHH Corp is trading at a lower price-to-earnings ratio than Synchrony Financial, indicating that it is currently the more affordable of the two stocks.
Synchrony Financial beats PHH Corp on 11 of the 15 factors compared between the two stocks.
PHH Corp Company Profile
PHH Corporation is a standalone mortgage company. The Company provides outsourced mortgage banking services to a range of clients, including financial institutions and real estate brokers throughout the United States, and is focused on originating, selling, servicing and subservicing residential mortgage loans through its subsidiary, PHH Mortgage Corporation and its subsidiaries. It operates through two segments: Mortgage Production and Mortgage Servicing. The Mortgage Production segment provides mortgage loan origination services and sells mortgage loans. The Mortgage Servicing segment performs servicing activities for loans originated by the Company and mortgage servicing rights purchased from others, and acts as a subservicer for certain clients that own the underlying mortgage servicing rights. The Mortgage Production segment provides private label mortgage services to financial institutions and real estate brokers, and sources mortgage loans through its retail platform.
Synchrony Financial Company Profile
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.
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