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joined discussion08/18/2022 15:48

Why does Buffett love Ally financial?

According to the 13F document submitted by Berkshire in June, Warren Buffett is placing a large amount of money on Ally financial Inc. Buffett has increased 234.47% of the company's shares, and the current market value is about 390 million US dollars, with a shareholding ratio of 9.7%. This makes Berkshire one of Ally's largest shareholders.
Why does Buffett love Ally financial?
Ally's one-year forward P / E ratio is about X5, and the P / E ratio is lower than x1. Ally's financial position is very strong, so it's easy to see why Buffett likes this stock. From 2018 to 2021, Ally's revenue jumped from US $7 billion to US $8.9 billion, with a 3-year CAGR of about 8%. During the same period, net profit more than doubled: from US $1.5 billion in 2018 to US $2.9 billion in 2021 (profit margin 33%).

Ally has not seen any substantial slowdown in the recent macroeconomic development. In the past 12 months, the company's revenue was $9.4 billion and its net income was $2.7 billion (28% profit margin).
Ally's share price has fallen about 35% year to date, while the S & P 500 index $S&P 500 index(.SPX.US)$ has fallen nearly 15%.

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