Have you been eager to see how Ally Financial Inc. (ALLY) performed in Q4 in comparison with the market expectations? Let’s quickly scan through the key facts from this Detroit, Michigan-based automotive financial services company’s earnings release this morning:
An Earnings Beat
Ally Financial came out with adjusted earnings per share of 40 cents, beating the Zacks Consensus Estimate of 39 cents per share.
Weak top line was more than offset by fall in expenses, thereby leading to this earnings beat.
How Was the Estimate Revision Trend?
You should note that the earnings estimate revisions for Ally Financial depicted pessimism prior to the earnings release. The Zacks Consensus Estimate has moved 7.1% lower over the last 30 days.
However, Ally Financial has a decent earnings surprise history. Before posting an earnings beat in Q4, the company delivered two positive surprises in the prior three quarters. Overall, the company surpassed the Zacks Consensus Estimate by an average of 28.72% in the trailing four quarters.
Revenue Came In Lower Than Expected
Ally Financial posted revenues of $1.1 billion, which missed the Zacks Consensus Estimate of $1.2 billion. Also, it compared unfavorably with the year-ago number of $1.2 billion.
Key Statistics to Note:
§ Ally Financial fully exited TARP in Dec 2014: The U.S. taxpayer received $19.6 billion, $2.4 billion more than initially invested.
§ Dealer Financial Services: Pre-tax income up 45% from prior year period
§ Ally Bank: Annual retail deposit growth of 11% to $48.0 billion
What Zacks Rank Says
The estimate revisions that we discussed earlier have driven a Zacks Rank #3 (Hold) for Ally Financial. However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. While things apparently look favorable, it all depends on what sense the just-released report makes to the analysts.
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