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Is Ally Financial (ALLY) a Great Value Stock Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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 #1 (Strong Buy), as well as a Value grade of A.

Investors should also note that ALLY holds a PEG ratio of 0.63. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ALLY's PEG compares to its industry's average PEG of 0.76. Within the past year, ALLY's PEG has been as high as 0.64 and as low as 0.45, with a median of 0.57.

Finally, investors should note that ALLY has a P/CF ratio of 4.41. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. ALLY's P/CF compares to its industry's average P/CF of 5.01. ALLY's P/CF has been as high as 4.41 and as low as 3.08, with a median of 3.92, 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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