- The stock trading at just 0.69x tangible book value is pricing in wholesale credit deterioration even as company credit metrics tell a different story, says BTIG's Mark Palmer, reiterating his Buy call and $32 price target (a double from here) on Ally Financial (ALLY -0.4%).
- Reporting Q4 originations of $9.3B vs. $9B a year ago, Ally also posted a net charge-off ratio of 0.72% and loan loss provisions of $240M -neither indicative of significant credit deterioration, says Palmer.
- Further, the company guided to adjusted EPS growth of 15% this year and reiterated its intention to initiate a common dividend and buyback program this year.
- Previously: Ally Financial beats by $0.01, misses on revenue (Feb. 2)