Ally Financial Inc
How Visa’s Valuation Compares
While Visa’s (V) NTM (next-12-month) price-to-book ratio is 7.4x, competitors’ average is 8.0x.
Why Visa Sees the US Market as Profitable
At the J.P. Morgan Global Technology, Media and Communications Conference, Visa (V) stated it would be targeting the US market’s significant untapped opportunities, which could boost growth.
Discover Financial Services: Assessing Analysts’ Ratings
Five analysts suggested a “hold,” one recommended a “strong sell,” and nine recommended a “strong buy” on DFS stock.
Discover Financial’s Cashback Checking Program
Discover’s enterprise-value-to-revenue ratio is ~4.0.
What Does Discover Financial Have in Mind for 2018?
Discover’s 4Q17 operating margin stood at ~49.6% on a TTM (trailing-12-months) basis.
What’s Expected from Discover Financial in 1Q18?
Wall Street analysts gave a high estimate of $2.02 and a low estimate of $1.65 on Discover’s earnings per share for 1Q18.
Mastercard Has Higher Valuations—Here’s Why
Mastercard’s (MA) PBV (price-to-book value ratio) is 18.08x on a next-12-month basis. The company has a premium valuation, as its competitors’ average is 4.2x.
Mastercard Increases Speed during Checkouts
On April 5, 2018, Mastercard (MA) made an announcement that from April 13 onward, all merchants in Canada and the United States would be able to eliminate the process of requiring signatures from cardholders.
What Could Drive Mastercard’s Performance?
After the announcement of the imposition of tariffs by President Donald Trump, fears regarding a trade war gripped investors.
How Are Analysts Viewing American Express Stock?
American Express (AXP) is covered by 31 analysts in March 2018. Two of them have given it a “strong sell” rating, and one is recommending “sell.”
Discover Financial Services: What Analysts Are Saying
Twenty-six analysts are tracking Discover Financial Services (DFS) in January 2018. Six of them have given it a “hold” rating, and one is recommending a “strong sell.”
Behind Discover Financial Services’ Discounted Valuations
Discover Financial Services (DFS) has a PE (price-to-earnings) ratio on an NTM (next 12-month) basis of 10.26x, while the average for its peers is 13.97x.
Discover Financial Services’ Direct Banking Segment in 4Q17
The Direct Banking segment of Discover Financial Services (DFS) generated pre-tax income of $870 million in 4Q17 compared to $868 million in 4Q16, which was a marginal rise.
Why Discover Financial’s Operating Expenses Rose Year-over-Year
In 4Q17, Discover Financial incurred total operating expenses of $1 billion compared to $897 million in 4Q16, which is a rise of 15%.
Factors That Led to a Decline in Discover’s Net Income in 1H17
Discover Financial’s employee compensation expenses rose 7% in 1H17 compared to 1H16.
Discover Misses Earnings Estimates but Beats Revenue Estimates
Discover Financial Services (DFS) posted earnings per share of $1.40 in 2Q17, which missed the analysts’ estimate of $1.45. DFS reported revenues of $2.42 billion in 2Q17, beating the analysts’ estimate of $2.40 billion.
Why the September FOMC Meeting Was a Close Call
The September FOMC (Federal Open Market Committee) meeting had surprised market participants with three dissenting votes.
A Detailed Portfolio Analysis of PLVBX
The PIMCO RAE Low Volatility Plus International Fund – Class A (PLVBX) portfolio consists of securities that are issued all over the world.
PLVBX Offers Investors a Different Approach
The PIMCO RAE Low Volatility Plus International Fund – Class A (PLVBX) uses a long or short hedge fund strategy to achieve its investment objective.
A Detailed Holdings Analysis of PLVVX
PLVVX holds fixed income securities in both long and short positions. The fund also holds derivative forward, future, and swap agreements on government securities, indexes, and currencies.
PLVVX: Weak Emerging Economies Lead to Poor Performance
The PIMCO RAE Low Volatility Plus Emerging Fund Class A (PLVVX) is an alternative mutual fund that mimics the long/short strategy to construct a portfolio with low volatility and high-income securities.
Outflows in High-Yield Funds Fell, Yield on High-Yield Bonds Rose
Investor flows in high-yield bond funds were negative last week. According to Lipper, the net outflows from high-yield bond funds totaled $0.5 billion.
What Is Bankruptcy Investing?
Informed investors can profit from businesses that have filed for bankruptcy. A chapter 11 bankruptcy gives a company a second chance to revive its business.
Why Distressed Debt Investment Is Key in Bankruptcy Investing
During the period of bankruptcy, investors can buy distressed debt at a far cheaper rate from the secondary market.
Ally Financial Issues $1.4 Billion in Junk Bonds Last Week
The number of high-yield bond issuances kept the primary market very busy in the week ended May 15. Investors had a strong appetite for junk bonds.
Maverick Capital Bumps Up Santander by $70 Million in Q4
Maverick Capital increased its position in Santander Consumer USA Holdings (SC) by more than $70 million in stock. Santander accounts for 4.44% of the fund’s portfolio in 4Q14.
Why the Federal Reserve’s Meeting Minutes Affect Your Investments
You don’t have to be an institutional investor or money manager for the FOMC’s meeting minutes to have an impact on your investments.
Oaktree Capital Boosts Holdings in Ally Financial
Ally Financial joined TARP in 2008 as part of an effort to stabilize the US auto industry. The firm went on to become a major provider of auto finance.
High Yield Bond Funds Finally See Inflows after 2 Weeks
Ally Financial, Whiting Petroleum, and Cliffs Natural Resources were among the most prolific issuers of high yield bonds in the primary market.
Ally Financial and Whiting Petroleum: The Biggest Debt Issuers
Ally Financial (ALLY) provided financial services and products to auto dealers in the US. It issued $1.25 billion in BB+ rated senior notes in two tranches.
High Yield Debt Issuance Gains Momentum
Following the Fed’s monetary policy announcement, issuers of junk bonds, or high yield debt, returned to the market in the week leading up to March 27.
Eased Lending Standards Boost BB&T’s Auto Lending
Easing underwriting standards across auto lenders is leading to an increase in subprime lending. Dealer Financial Services grew average loans by 10.5% compared to 2013.
Why did companies aggressively raise debt?
Pricing was competitive for BB-rated borrowers, and higher rated issuers could issue debt at lower rates. Companies began to aggressively raise debt.
Credit card loan growth strong for Wells Fargo in 4Q14
Total credit card loans outstanding at Wells Fargo stood at $31.12 billion at the end of 4Q14. This was a growth of 16% compared to 4Q14.
How did loan types fare in 2014?
The individual auto loan was the fastest growing segment in 2014, driven primarily by strong demand, low rates, and banks relaxing lending criteria.
Auto loans work hard for Wells Fargo
Wells Fargo has an expansive reach in this segment, offering loans through nearly 15,000 dealers across the U.S. It even has direct agreements with a few manufacturers, including GM.
Why Davidson Kempner eliminates position in JPMorgan Chase
Davidson Kempner exited a position in JPMorgan Chase & Co. (JPM) that accounted for 1.29% of the fund’s 1Q14 portfolio. This position was initiated in 1Q14. JPMorgan Chase is a leading global financial services firm. It has $2.5 trillion assets. It has operations worldwide.
Must-know: Davidson Kempner sells stake in Omnicom
Davidson Kempner exited a position in Omnicom (OMC) that accounted for 1.93% of the fund’s 1Q14 portfolio. The position was initiated in 1Q14. Omnicom is a leading global advertising, marketing, and corporate communications company. It offers its services to over 5,000 clients in more than 100 countries.
Why Davidson Kempner initiates new position in Newell Rubbermaid
Davidson Kempner initiated a new position in Newell Rubbermaid (NWL) that accounted for 1.22% of the fund’s 2Q14 portfolio. Newell Rubbermaid is a global marketer of consumer and commercial products. The products include writing instruments, consumer products for home, tools like hand tools, and power tool accessories.
Why Davidson Kempner adds new position in WL Ross Holding
Davidson Kempner initiated a new position in WL Ross Holding (WLRH) that accounted for 1.85% of the fund’s 2Q14 portfolio. WL Ross is a newly organized blank check company. It was formed by billionaire Wilbur Ross. It was formed to affect a merger, capital stock exchange, asset acquisition, stock repurchase, stock purchase, reorganization, or similar business combination with one or more businesses.
Why Davidson Kempner adds new position in Ally Financial
Davidson Kempner initiated a new position in Ally Financial Inc. (ALLY) that accounted for 5.5% of the fund’s 2Q14 portfolio. Ally Financial is currently the second largest position in the fund’s portfolio. Ally Financial is an automotive financial services company. It has ~95 years of experience.
Overview: Davidson Kempner Capital Management’s 2Q14 positions
Davidson Kempner Capital Management LLC is a hedge fund manager. It manages ~$22 billion in assets. In 2Q14, Davidson Kempner Capital added new positions in Ally Financial Inc. (ALLY), WL Ross Holding (or WLRH), Newell Rubbermaid (NWL), and B/E Aerospace (BEAV).
D. E. Shaw initiates a new position in Ally Financial
D. E. Shaw initiated a new position in Ally Financial that accounts for 0.13% of the company’s U.S. long portfolio. Ally Financial is an automotive financial services company with ~95 years of experience.
D. E. Shaw adds a new position in Navient
D. E. Shaw initiated a new position in Navient that accounts for 0.28% of the company’s U.S. long portfolio. Navient holds the largest portfolio of education loans insured or guaranteed under the Federal Family Education Loan Program (referred to as FFELP loans).
Bear strategy: Profit from rising rates with fixed income ETFs
Investors could consider hedging their short-term duration risk (HYG: 3.98 years, JNK: 4.20 years) with a short position in longer-dated bonds.