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Are Investors Undervaluing Ally Financial (ALLY) Right Now?
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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Ally Financial (ALLY - Free Report) . ALLY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 8.06, while its industry has an average P/E of 9.10. ALLY's Forward P/E has been as high as 13.05 and as low as 7.79, with a median of 8.90, all within the past year.
ALLY is also sporting a PEG ratio of 0.64. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ALLY's PEG compares to its industry's average PEG of 0.73. Over the last 12 months, ALLY's PEG has been as high as 2.26 and as low as 0.61, with a median of 0.70.
Another valuation metric that we should highlight is ALLY's P/B ratio of 0.88. Investors use the P/B ratio to look at a stock's market value versus 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 1.01. ALLY's P/B has been as high as 1.01 and as low as 0.77, with a median of 0.88, over the past year.
Finally, investors will want to recognize that ALLY has a P/CF ratio of 4.26. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 6.74. Over the past 52 weeks, ALLY's P/CF has been as high as 4.92 and as low as 3.43, with a median of 4.26.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Ally Financial is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ALLY feels like a great value stock at the moment.
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Are Investors Undervaluing Ally Financial (ALLY) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Ally Financial (ALLY - Free Report) . ALLY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 8.06, while its industry has an average P/E of 9.10. ALLY's Forward P/E has been as high as 13.05 and as low as 7.79, with a median of 8.90, all within the past year.
ALLY is also sporting a PEG ratio of 0.64. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ALLY's PEG compares to its industry's average PEG of 0.73. Over the last 12 months, ALLY's PEG has been as high as 2.26 and as low as 0.61, with a median of 0.70.
Another valuation metric that we should highlight is ALLY's P/B ratio of 0.88. Investors use the P/B ratio to look at a stock's market value versus 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 1.01. ALLY's P/B has been as high as 1.01 and as low as 0.77, with a median of 0.88, over the past year.
Finally, investors will want to recognize that ALLY has a P/CF ratio of 4.26. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 6.74. Over the past 52 weeks, ALLY's P/CF has been as high as 4.92 and as low as 3.43, with a median of 4.26.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Ally Financial is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ALLY feels like a great value stock at the moment.