Synchrony (SYF) reported impressive quarterly earnings of $2.86 per share, beating the Zacks Consensus Estimate of $2.22. This marks a rise from last year’s earnings of $1.94 per share, leading to an earnings surprise of 28.83%. In the prior quarter, Synchrony was expected to earn $1.72 per share but actually reported $2.50, a surprise of 45.35%. Over the last four quarters, Synchrony has consistently outperformed consensus EPS estimates. For the quarter ending September 2025, the company saw revenues of $4.72 billion, beating expectations by 0.64%. This is an increase from $4.61 billion a year ago. Synchrony has exceeded revenue estimates twice in the last four quarters. Synchrony shares have gained about 12.1% since the start of the year, compared to the S&P 500’s 13% rise. Future movements in the stock will depend largely on management’s guidance during the earnings call. Currently, the consensus EPS estimate for the next quarter is $1.93, with expected revenues of $4.83 billion. For the current fiscal year, estimates are $8.35 EPS on $18.51 billion revenue. In the same industry, Inter & Co. Inc. (INTR) is projected to report earnings of $0.14 per share, a 40% increase from last year. Their estimated revenues are $381.13 million, up 26.1% year-over-year. Synchrony’s strong earnings present a clear opportunity for traders. The stock is expected to open positively, but its implied volatility, which was high before the announcement, has likely dropped sharply, possibly from the 55th percentile to 30th. This “volatility crush” makes it cheaper to buy options but less profitable to sell them. This solid performance stands out against the stock’s overall underperformance this year and its “Hold” rating, creating some uncertainty. The market is waiting for management’s insights during the earnings call, especially regarding future loan growth and credit quality. Key points to watch will be their outlook on consumer spending leading into the holiday season. Recent government data for Q3 2025 shows credit card delinquency rates increased to 3.2%. However, this is still lower than the pre-pandemic average of 3.8% in 2019. This indicates Synchrony is successfully navigating a healthy consumer environment, although signs of normalization are emerging. The Federal Reserve’s decision to keep rates steady in its September 2025 meeting also provides a stable backdrop for lenders. Given the decrease in volatility and ongoing questions from the earnings call, a neutral strategy may be wise in the coming weeks. Selling an iron condor could be a good option, as it profits if the stock stays within a certain range. This strategy allows us to collect premium while the market digests the earnings report and guidance. For those with a more optimistic outlook, believing this earnings surprise will lead to analyst upgrades, buying call options is now more appealing. With lower volatility, we can purchase calls for November or December at a better price. This strategy bets that the strong results will prompt a positive re-assessment of the stock in the coming weeks.

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