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Should Value Investors Buy Ally Financial (ALLY) Stock?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 8.06. This compares to its industry's average Forward P/E of 9.13. 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 9.07.
Investors will also notice that ALLY has a PEG ratio of 0.64. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ALLY's PEG compares to its industry's average PEG of 0.73. Within the past year, ALLY's PEG has been as high as 2.26 and as low as 0.63, with a median of 0.72.
Another valuation metric that we should highlight is ALLY's P/B ratio of 0.90. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 0.95. Over the past year, ALLY's P/B has been as high as 1.01 and as low as 0.74, with a median of 0.89.
Finally, our model also underscores that ALLY has a P/CF ratio of 4.20. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.66. ALLY's P/CF has been as high as 4.92 and as low as 3.30, with a median of 4.25, all within the past year.
These are just a handful of the figures considered in Ally Financial's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that ALLY is an impressive value stock right now.
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Should Value Investors Buy Ally Financial (ALLY) Stock?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 8.06. This compares to its industry's average Forward P/E of 9.13. 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 9.07.
Investors will also notice that ALLY has a PEG ratio of 0.64. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ALLY's PEG compares to its industry's average PEG of 0.73. Within the past year, ALLY's PEG has been as high as 2.26 and as low as 0.63, with a median of 0.72.
Another valuation metric that we should highlight is ALLY's P/B ratio of 0.90. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 0.95. Over the past year, ALLY's P/B has been as high as 1.01 and as low as 0.74, with a median of 0.89.
Finally, our model also underscores that ALLY has a P/CF ratio of 4.20. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.66. ALLY's P/CF has been as high as 4.92 and as low as 3.30, with a median of 4.25, all within the past year.
These are just a handful of the figures considered in Ally Financial's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that ALLY is an impressive value stock right now.