Synchrony Financial (SYF): Among Billionaire Cliff Asness' Stock Picks with Huge Upside Potential

We recently published a list of Billionaire Cliff Asness’ 10 Stock Picks with Huge Upside Potential. In this article, we are going to take a look at where Synchrony Financial (NYSE:SYF) stands against other billionaire Cliff Asness’ stock picks with huge upside potential.

Cliff Asness, the founder, managing principal, and chief investment officer of AQR Capital Management, is a well-known figure in the world of finance. Starting with a $10 million commitment from a small group of investors in 1995, Asness was able to boost the Goldman Sachs Global Alpha Fund’s assets to more than $100 million in just a handful of months. Cliff Asness’ investment strategies, which focus on value and momentum, have delivered exceptional returns for AQR, setting him apart from his fellow hedge fund managers. As a testament, the fund has produced positive returns over the last three years, with its greatest year in 2022, when it returned 43.5%.

The first quarter of 2025 continued that momentum. As Wall Street grappled with increased volatility resulting from President Donald Trump’s unpredictable tariff policy, AQR Capital Management outperformed the market by 9%. The firm’s Apex strategy, a $3 billion multi-strategy fund that includes equities, macro, and arbitrage trades, rose 3.4% in March, adding to its strong quarterly performance. Meanwhile, AQR’s Delphi Long-Short Equity Strategy returned 9.7%, while its trend-following Helix strategy gained 3% during the same period.

Cliff Asness has repeatedly stated that he is not an admirer of Bitcoin. In a recent CNBC interview, the hedge fund manager voiced pessimism about Bitcoin, claiming that it had no realistic use case, although he did not rule out the possibility that the leading cryptocurrency has formed a bubble. Back in February, the billionaire stated that Bitcoin and the S&P 500, were basically “the same thing” with varying amounts of volatility. Asness has also questioned the notion that Bitcoin must be seen as a store of value simply because it has a limited supply.

The billionaire seemed even more critical of the idea of a cryptocurrency reserve, a stance that sharply contrasts with President Donald Trump’s. In a piece written for The Free Press, the money manager stated his thoughts about the President’s executive order:

“I’ve been managing money for 33 years now with some modest success. While there are some worthy competitors, it’s hard for me to remember a much worse idea than the U.S. launching a “strategic cryptocurrency reserve.” Nevertheless, on Thursday, President Donald Trump issued an executive order calling for just such a fund. David Sacks—Trump’s crypto czar—tweeted that the reserve would be “like a digital Fort Knox,” perhaps forgetting that the U.S. has been off the gold standard since 1933. In any case, his words do not diminish my scorn for this dangerous boondoggle, as I will explain below.

A sovereign wealth fund for the U.S., which President Trump has also begun planning, is inappropriate, unneeded, likely harmful, and potentially quite corrupt. But a strategic cryptocurrency reserve looks at a “normal” sovereign wealth fund and says, “Hold my beer,” as we are going to plaid.”

Our Methodology

For this article, we examined AQR Capital Management’s Q4 2024 13F filings to list down billionaire Cliff Asness’ stock picks with the highest upside potential. We ranked the companies in ascending order of their upside potential. These equities are also popular among elite hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Synchrony Financial (NYSE:SYF)

AQR Capital Management’s Q4 Stake: $258 million

Upside Potential as of April 26: 27.20%

Number of Hedge Fund Holders: 64

Synchrony Financial (NYSE:SYF) is a consumer finance company that provides credit cards, installment loans, and commercial financing. The company also offers private label and co-branded credit cards, as well as banking services.

Earlier this March, BofA Securities reiterated its Buy rating and $85 price target for Synchrony Financial (NYSE:SYF) shares. The endorsement comes amid debate over the long-term viability of some mitigating activities in light of anticipated regulatory changes. The firm’s analysts have expressed confidence in the company’s business strategy, implying that even if the era of ‘over earning’ ends earlier than expected, the valuation continues to be appealing.

On April 22, Synchrony Financial (NYSE:SYF) reported mixed results for the first quarter of 2025. The company’s average active accounts increased 3% year-over-year to 69 million, while purchasing volume jumped 4% to $41 billion and loan receivables increased 2% to $100 billion. However, the company’s financial results indicated major strain on profitability. Diluted earnings per share declined 40% year-over-year to $1.89, while return on assets came in at 2.5%. Additionally, net revenue fell by 23%, from $4,798 million to $3,718 million. This decline was mainly driven by an 87% drop in other income to $149 million, which was slightly offset by a 1% gain in net interest income to $4,464 million.

Overall, SYF ranks 7th on our list of billionaire Cliff Asness’ stock picks with huge upside potential. While we acknowledge the potential for SYF as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%.  If you are looking for an AI stock that is more promising than SYF but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.