Back to top

Image: Bigstock

Ally Financial (ALLY) Gains But Lags Market: What You Should Know

Read MoreHide Full Article

Ally Financial (ALLY - Free Report) closed the most recent trading day at $51.55, moving +0.57% from the previous trading session. The stock lagged the S&P 500's daily gain of 0.85%.

Coming into today, shares of the auto finance company and bank had lost 1.02% in the past month. In that same time, the Finance sector gained 2.93%, while the S&P 500 gained 2.85%.

ALLY will be looking to display strength as it nears its next earnings release. In that report, analysts expect ALLY to post earnings of $1.88 per share. This would mark year-over-year growth of 50.4%. Our most recent consensus estimate is calling for quarterly revenue of $2.01 billion, up 19.08% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.18 per share and revenue of $8.02 billion. These totals would mark changes of +169.97% and +20.01%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for ALLY. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 7.61% higher within the past month. ALLY is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, ALLY is holding a Forward P/E ratio of 6.27. Its industry sports an average Forward P/E of 7.18, so we one might conclude that ALLY is trading at a discount comparatively.

The Financial - Consumer Loans industry is part of the Finance sector. This group has a Zacks Industry Rank of 59, putting it in the top 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Ally Financial Inc. (ALLY) - free report >>

Published in