• Ally Financial‘s 1Q Adjusted EPS was reported at 45c, surpassing the estimated 33c
• Total deposits were slightly lower than expected at $155.08 billion compared to the anticipated $155.66 billion
• The Core return on tangible common equity was slightly above estimates at +6.5%, as against the estimate of +6.53%
• There was a marginal dip in Net interest margin to 3.13% from the estimated 3.14%
• Ally Financial reported a Net revenue of $1.99 billion, beating the estimate of $1.96 billion
• The Provision for loan losses stood at $507.0 million, which is less than the forecasted $525.8 million
• Net charge-offs were marginally lower than expected at $539.0 million against the estimated $539.4 million
• Consumer auto originations exceeded estimates, amounting to $9.80 billion versus the estimated $9.65 billion
• Net income attributable to common shareholders for the quarter was $129 million, a decrease from $291 million in the first quarter of 2023
• The decrease in net income was attributed to lower net financing revenue, higher provision for credit losses, and higher noninterest expenses. However, this was partially offset by an increase in other revenue
• The Provision for credit losses rose by $61 million Year on Year to $507 million, primarily due to increased net charge-offs, while there was some offset by a reserve release related to the deconsolidation of retail auto loans
• Opinions on the stock were mixed with 10 buys, 8 holds, and 3 sells
A look at Ally Financial Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 4 | |
| Growth | 3 | |
| Resilience | 2 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.4 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Ally Financial Inc., an automotive financial services company with a direct banking franchise, is positioned in the market with strong scores in Value and Dividend at 4 each, showcasing solid fundamentals for investors. These high scores suggest that the company is potentially undervalued and offers attractive dividend payouts, making it an appealing choice for long-term investors seeking stability and income.
However, Ally Financial‘s scores in Growth, Resilience, and Momentum at 3, 2, and 4 respectively indicate a mixed outlook. While the company shows promising momentum in its market performance, there are areas such as growth potential and resilience where improvements could enhance its long-term prospects. Overall, Ally Financial‘s strategic position as a financial holding company with a focus on automotive services may offer a moderate to promising outlook for investors, balancing strengths and areas for development.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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