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Should Value Investors Buy Ally Financial (ALLY) Stock?
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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Ally Financial (ALLY - Free Report) . ALLY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 8.12 right now. For comparison, its industry sports an average P/E of 8.16. Over the past 52 weeks, ALLY's Forward P/E has been as high as 13.05 and as low as 7.96, with a median of 9.12.
Investors will also notice that ALLY has a PEG ratio of 0.64. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ALLY's PEG compares to its industry's average PEG of 0.65. Over the past 52 weeks, ALLY's PEG has been as high as 2.26 and as low as 0.63, with a median of 0.74.
Investors should also recognize that ALLY has a P/B ratio of 0.90. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.07. Over the past 12 months, ALLY's P/B has been as high as 1.01 and as low as 0.74, with a median of 0.89.
Finally, investors will want to recognize that ALLY has a P/CF ratio of 4.21. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.58. ALLY's P/CF has been as high as 4.92 and as low as 3.28, with a median of 4.25, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Ally Financial is likely undervalued currently. And when considering the strength of its earnings outlook, ALLY sticks out at as one of the market's strongest value stocks.
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Should Value Investors Buy Ally Financial (ALLY) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Ally Financial (ALLY - Free Report) . ALLY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 8.12 right now. For comparison, its industry sports an average P/E of 8.16. Over the past 52 weeks, ALLY's Forward P/E has been as high as 13.05 and as low as 7.96, with a median of 9.12.
Investors will also notice that ALLY has a PEG ratio of 0.64. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ALLY's PEG compares to its industry's average PEG of 0.65. Over the past 52 weeks, ALLY's PEG has been as high as 2.26 and as low as 0.63, with a median of 0.74.
Investors should also recognize that ALLY has a P/B ratio of 0.90. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.07. Over the past 12 months, ALLY's P/B has been as high as 1.01 and as low as 0.74, with a median of 0.89.
Finally, investors will want to recognize that ALLY has a P/CF ratio of 4.21. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.58. ALLY's P/CF has been as high as 4.92 and as low as 3.28, with a median of 4.25, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Ally Financial is likely undervalued currently. And when considering the strength of its earnings outlook, ALLY sticks out at as one of the market's strongest value stocks.