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Ally Financial (ALLY) Stock Sinks As Market Gains: What You Should Know

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Ally Financial (ALLY - Free Report) closed at $52.64 in the latest trading session, marking a -0.23% move from the prior day. This change lagged the S&P 500's daily gain of 0.08%. At the same time, the Dow lost 0.56%, and the tech-heavy Nasdaq lost 4.81%.

Heading into today, shares of the auto finance company and bank had gained 13.84% over the past month, outpacing the Finance sector's gain of 5.21% and the S&P 500's gain of 0.64% in that time.

Investors will be hoping for strength from Ally Financial as it approaches its next earnings release, which is expected to be January 21, 2022. The company is expected to report EPS of $2.01, up 25.63% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.06 billion, up 4.07% from the prior-year quarter.

Any recent changes to analyst estimates for Ally Financial should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.78% higher within the past month. Ally Financial is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, Ally Financial is currently trading at a Forward P/E ratio of 15.71. This represents a premium compared to its industry's average Forward P/E of 8.1.

We can also see that ALLY currently has a PEG ratio of 0.5. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Financial - Consumer Loans industry currently had an average PEG ratio of 0.4 as of yesterday's close.

The Financial - Consumer Loans industry is part of the Finance sector. This group has a Zacks Industry Rank of 82, putting it in the top 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.


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