Recent Brain Trust Profits addition Synchrony Financial (NYSE: SYF) gained roughly 4 percent on Friday after reporting strong third-quarter results.

The company’s third-quarter net revenues (net interest income) increased 11 percent compared to a year ago to $3.88 billion. Net earnings of $555 million (or $0.70 per share) was 8.1 percent lower than the same comparison period due to higher provision for loan losses and higher expenses due to spending on growth initiatives.

Loan receivables grew $6 billion, or 9 percent to $76.9 billion. Management guided to a range of 7-to-9 percent growth this year, so the third-quarter figure is right on the high end of the guidance. In the first and second quarters, the growth was even better, at 11 percent, so the company is well on its way to beating its own projection. Interestingly, the lower loan growth in the third quarter is likely perceived by investors as a positive on earnings, since it requires less reserves to be set aside as reserves, which reduces earnings.

As management predicted, the net charge-offs as a percentage of total period-end loan receivables declined to 4.95 percent from 5.42 percent in the second quarter. This is still higher than last year’s same quarter, but it’s already expected as Synchrony has long warned the market about credit deterioration, and similar credit deterioration has been experienced by other financial companies.

As far back as mid-2016, Synchrony tightened its lending criteria and looks to be managing its risks well. During the third quarter, it actually lowered the provision for loan losses compared to the second quarter even though loan receivables increased. In other words, as loans continue to grow, Synchrony set aside slightly less reserves as provision for loss, a sign that it thinks credit deterioration is stabilizing.

Since provision for loan losses is treated as an expense, a lower figure means more of the top line flows to the bottom line.

As a group, we are pleased that our recent picks as a group have performed quite well since joining our portfolio. TAL Education (NYSE: TAL) and ChannelAdvisor (NYSE: ECOM) have already both made double-digit percent gains in a little more than two months in the portfolio, and AngioDynamics (Nasdaq: ANGO) is already up about 6 percent in just one week in the portfolio. In case you are wondering, after the strong gain on Friday SYF is up roughly 5.5 percent in the two weeks since our recommendation.

Jazz Pharmaceuticals (Nasdaq: JAZZ) so far has been the lone market laggard among the recent additions, and even it hasn’t been terrible, down about 3 percent since joining our portfolio one month ago. At this point we aren’t overly concerned, but it goes without saying we are watching closely. We expect the stock to bounce back.