Ally Financial Profit Margin vs. Return On Equity
| GMZ Stock | EUR 33.19 0.07 0.21% |
For Ally Financial profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Ally Financial to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Ally Financial utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Ally Financial's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Ally Financial over time as well as its relative position and ranking within its peers.
Ally |
Ally Financial Return On Equity vs. Profit Margin Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Ally Financial's current stock value. Our valuation model uses many indicators to compare Ally Financial value to that of its competitors to determine the firm's financial worth. Ally Financial is one of the top stocks in profit margin category among its peers. It also is one of the top stocks in return on equity category among its peers reporting about 0.53 of Return On Equity per Profit Margin. The ratio of Profit Margin to Return On Equity for Ally Financial is roughly 1.88 . The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Ally Financial's earnings, one of the primary drivers of an investment's value.Ally Return On Equity vs. Profit Margin
Profit Margin measures overall efficiency of a company and shows its ability to withstand competition as well as defend against adverse conditions such as rising costs, falling prices, decline in sales or management distress. Profit margin tells investors how well the company executes on its overall pricing strategies as well as how effective the company in controlling its costs.
Ally Financial |
| = | 0.22 % |
In a nutshell, Profit Margin indicator shows the amount of money the company makes from total sales or revenue. It can provide a good insight into companies in the same sector, as well as help to identify trends of a company from year to year.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Ally Financial |
| = | 0.11 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Ally Return On Equity Comparison
Ally Financial is currently under evaluation in return on equity category among its peers.
Ally Financial Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Ally Financial, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Ally Financial will eventually generate negative long term returns. The profitability progress is the general direction of Ally Financial's change in net profit over the period of time. It can combine multiple indicators of Ally Financial, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Ally Financial Inc. provides various financial products and services to consumers, businesses, automotive dealers, and corporate customers primarily in the United States and Canada. Ally Financial Inc. was founded in 1919 and is headquartered in Detroit, Michigan. ALLY FINANCIAL operates under Specialty Finance classification in Germany and is traded on Frankfurt Stock Exchange. It employs 8200 people.
Ally Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Ally Financial. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Ally Financial position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Ally Financial's important profitability drivers and their relationship over time.
Use Ally Financial in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Ally Financial position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ally Financial will appreciate offsetting losses from the drop in the long position's value.Ally Financial Pair Trading
Ally Financial Pair Trading Analysis
The ability to find closely correlated positions to Ally Financial could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Ally Financial when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Ally Financial - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Ally Financial to buy it.
The correlation of Ally Financial is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Ally Financial moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Ally Financial moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Ally Financial can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Ally Financial position
In addition to having Ally Financial in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Agriculture Thematic Idea Now
Agriculture
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Agriculture theme has 30 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Agriculture Theme or any other thematic opportunities.
| View All Next | Launch |
Additional Information and Resources on Investing in Ally Stock
When determining whether Ally Financial offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Ally Financial's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Ally Financial Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Ally Financial Stock:Check out Risk vs Return Analysis. For more detail on how to invest in Ally Stock please use our How to Invest in Ally Financial guide.You can also try the Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
To fully project Ally Financial's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Ally Financial at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Ally Financial's income statement, its balance sheet, and the statement of cash flows.