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Ally Financial (ALLY) Q1 Earnings Lags on Higher Expenses

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Have you been eager to see how Ally Financial Inc. (ALLY - Free Report) performed in Q1 in comparison with the market expectations? Let’s quickly scan through the key facts from this Detroit, Michigan-based automotive financial services company’s earnings release this morning:

An Earnings Miss

Ally Financial came out with adjusted earnings of 48 cents per share, lagging the Zacks Consensus Estimate of 49 cents.

Higher expenses and provisions were largely responsible for this earnings miss.

How Was the Estimate Revision Trend?

You should note that the earnings estimate revisions for Ally Financial depicted a bearish stance to the earnings release. The Zacks Consensus Estimate has decreased 2% over the last 30 days.

Before posting the earnings miss in Q1, the company delivered positive surprises in two of the trailing four quarters, with an average beat of 2.1%.
 

Ally Financial Inc. Price and EPS Surprise
 

Ally Financial Inc. Price and EPS Surprise | Ally Financial Inc. Quote

Revenues Lag Expectations

Ally Financial posted total net revenues of $1.38 billion, lagging the Zacks Consensus Estimate of $1.39 billion. However, it was above the prior-year quarter figure of $1.33 billion.

Key Statistics
 

  • Auto originations of $8.9 billion in the quarter
  • Retail deposit growth of 19% year over year to $70 billion as of Mar 31, 2017
  • Net financing revenue of $979 million, up 2.9% year over year

What Zacks Rank Says

The estimate revisions that we discussed earlier have driven a Zacks Rank #3 (Hold) for Ally Financial. However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. While things apparently look unfavorable, it all depends on what sense the just-released report makes to the analysts.

(You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.)

Check back later for our full write up on this Ally Financial earnings report!

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