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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 the most recent trading day at $43.49, moving +1.35% from the previous trading session. This change outpaced the S&P 500's 0.81% loss on the day. Meanwhile, the Dow lost 0.46%, and the Nasdaq, a tech-heavy index, lost 1.69%.

Prior to today's trading, shares of the auto finance company and bank had gained 9.67% over the past month. This has outpaced the Finance sector's gain of 8.23% and the S&P 500's gain of 3.56% in that time.

Investors will be hoping for strength from ALLY as it approaches its next earnings release. The company is expected to report EPS of $1.06, up 340.91% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.76 billion, up 24.4% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.50 per share and revenue of $7.23 billion, which would represent changes of +48.51% and +8.19%, respectively, from the prior year.

Any recent changes to analyst estimates for ALLY should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 2.24% higher within the past month. ALLY is currently a Zacks Rank #2 (Buy).

Digging into valuation, ALLY currently has a Forward P/E ratio of 9.37. For comparison, its industry has an average Forward P/E of 9.66, which means ALLY is trading at a discount to the group.

The Financial - Consumer Loans industry is part of the Finance sector. This group has a Zacks Industry Rank of 40, putting it in the top 16% 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.

To follow ALLY in the coming trading sessions, be sure to utilize Zacks.com.


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