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

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Ally Financial (ALLY - Free Report) closed at $26.51 in the latest trading session, marking a +1.65% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.16%. Meanwhile, the Dow gained 0.01%, and the Nasdaq, a tech-heavy index, added 0.09%.

Heading into today, shares of the auto finance company and bank had lost 5.37% over the past month, lagging the Finance sector's gain of 3.36% and the S&P 500's gain of 1.83% in that time.

Wall Street will be looking for positivity from Ally Financial as it approaches its next earnings report date. The company is expected to report EPS of $1.01, down 50% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.04 billion, down 7.03% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.05 per share and revenue of $8.41 billion. These totals would mark changes of -29.73% and +2.45%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Ally Financial. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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 5.16% lower within the past month. Ally Financial is currently a Zacks Rank #5 (Strong Sell).

Looking at its valuation, Ally Financial is holding a Forward P/E ratio of 4.31. This represents a discount compared to its industry's average Forward P/E of 6.59.

The Financial - Consumer Loans industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 237, which puts it in the bottom 6% 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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