Why Did Warren Buffett Buy Synchrony Financial?
In Berkshire Hathaway's (NYSE: BRK-A) (NYSE: BRK-B) latest Securities and Exchange Commission filings, the company revealed that it has initiated a position of 17.5 million shares in Synchrony Financial (NYSE: SYF) worth over a half-billion dollars. Here's a quick rundown of what Synchrony Financial does and what may have attracted Warren Buffett and his team to the stock.
Synchrony Financial is the largest issuer of private-label store-branded credit cards in the United States. Formerly a part of General Electric's consumer finance division, the company was spun off in November 2015.
The company issues credit cards for an extensive list of retailers, and among the most notable names in Synchrony's retail card portfolio are Amazon, Wal-Mart, Lowe's, T.J. Maxx, Gap, and Dicks Sporting Goods, just to name a few. Synchrony also provides promotional financing for major purchases for retailers such as Ashley Homestore and Guitar Center, and also operates healthcare financing platform CareCredit. The company has over 69 million active customer accounts and financed $125 billion in purchases in 2016.
Source: Fool.com
