bobozou Posted September 25, 2014 Share Posted September 25, 2014 Hmm... Why would they issue new debt instead of using deposit to retire the debt? Is it because they don't have sufficient deposit to do so? A bank this size will try to balance its access to different funding markets... so they are always going to be an issuer of LT debt. A key purpose of this transaction, which will provide negligible earnings improvement, was probably to create an on-the-run 10y bond (which Ally previously lacked) - improves liquidity and comparability of the debt structure. Muscleman - I believe that is true... off top of my head, about $60B in deposits vs $110B in assets... hence it will take several years for deposits to grow to 100B+... and thanks for link Morningstar - good point, most financials have different sources of funding (redundancy, in engineering parlance). The new debt matches maturity, and also appears MUCH cheaper (3% vs 8%) Link to comment Share on other sites More sharing options...
LowIQinvestor Posted September 26, 2014 Share Posted September 26, 2014 Anyone have access to the Wells Fargo upgrade notes? "*DJ Ally Financial Started at Outperform by Wells Fargo >ALLY" "Well Fargo set a price target range of $27 to $28 for Ally" Thanks Link to comment Share on other sites More sharing options...
LowIQinvestor Posted October 6, 2014 Share Posted October 6, 2014 Anybody else think there is very odd activity in these? "ALLY Nov 22 2014 24 Call" Maybe I have some "confirmation bias" but someone is very bullish in the short term. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted October 15, 2014 Share Posted October 15, 2014 Ok, my timing was awful on this but I am doubling down. It WILL be a $28 stock in 2 years Link to comment Share on other sites More sharing options...
shhughes1116 Posted October 15, 2014 Share Posted October 15, 2014 Awful timing? Nonsense. If you buy an ownership stake in a company and the price decreases substantially, you should rejoice because you can buy a larger ownership stake. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted October 17, 2014 Share Posted October 17, 2014 Govt selling to me: http://www.reuters.com/article/2014/10/17/ally-financial-brief-idUSS8N0SC00020141017?feedType=RSS&feedName=financialsSector Link to comment Share on other sites More sharing options...
PatientCheetah Posted October 17, 2014 Share Posted October 17, 2014 now the indiscriminate selling made sense. glad i added Link to comment Share on other sites More sharing options...
MrB Posted October 20, 2014 Share Posted October 20, 2014 Pages 14 & 15 of the 10-k scared me. Too dependent on GM & Chrysler and that business is slipping. Also going up against Santander? No thank you. Like the non branch banking side of things though. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted October 20, 2014 Share Posted October 20, 2014 "Ally Earns Profit for Taxpayers as Government Pares Ownership Unlikely Turnaround the Product of Long, Tumultuous Trip Through the Treasury’s Bailout Program": http://online.wsj.com/articles/ally-earns-profit-for-taxpayers-as-government-pares-ownership-1413741602?ru=yahoo?mod=yahoo_itp&cb=logged0.8109255384188145 Wonder if there is anyway to split the company up some more? (Auto Lending & Internet Bank) Link to comment Share on other sites More sharing options...
muscleman Posted October 29, 2014 Share Posted October 29, 2014 Q3 is in. I checked WFC's long term liability/deposit liability ratio and it is something like 20%. Ally's long term debt/deposit liability ratio is over 120%. So there is still more room for ROE improvement. Does anyone have questions about their insurance unit? I can't figure out what's the float. The underwriting doesn't seem that good. http://google.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=10267219-61531-171390&type=sect&TabIndex=2&companyid=12134&ppu=%252fdefault.aspx%253fsym%253dALLY Link to comment Share on other sites More sharing options...
johngu Posted October 30, 2014 Share Posted October 30, 2014 Hi guys. Somewhat of a newbie here. Was wondering if someone can educate me a bit on OID. I know it's original issue discount where they issue debt at a price below the face value, and then amortize the different over time as a cost. What I'm a bit uncertain about are 1) Ally refers to net financing revenue excluding OID. I imagine this is effectively their interest income - interest expense excluding OID? They seem to compute metrics ignoring OID, which IMO is a real cost. Certainly not a cash cost until debt repayment, but a real one nonetheless. Is there a good rationale for excluding OID in their pro-forma? Thanks. Link to comment Share on other sites More sharing options...
muscleman Posted November 5, 2014 Share Posted November 5, 2014 http://www.reuters.com/article/2014/10/31/ally-financial-investigation-idUSL1N0SQ15W20141031 Thoughts on the SEC probing? I bet that is probably why the share price has been weak. Santander CS, Ally are both been investigated. Link to comment Share on other sites More sharing options...
muscleman Posted November 5, 2014 Share Posted November 5, 2014 Hi guys. Somewhat of a newbie here. Was wondering if someone can educate me a bit on OID. I know it's original issue discount where they issue debt at a price below the face value, and then amortize the different over time as a cost. What I'm a bit uncertain about are 1) Ally refers to net financing revenue excluding OID. I imagine this is effectively their interest income - interest expense excluding OID? They seem to compute metrics ignoring OID, which IMO is a real cost. Certainly not a cash cost until debt repayment, but a real one nonetheless. Is there a good rationale for excluding OID in their pro-forma? Thanks. It doesn't matter how they report pro-forma statements. We just need to focus on our "owner earnings". With that said, they are in the process of refinancing these bonds, so the return on equity should slowly creep up. Link to comment Share on other sites More sharing options...
saltybit Posted December 2, 2014 Share Posted December 2, 2014 http://www.reuters.com/article/2014/12/01/us-autos-loans-idUSKCN0JF2NK20141201 Ally Financial overtakes Wells Fargo as top U.S. auto lender Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted December 2, 2014 Share Posted December 2, 2014 http://www.reuters.com/article/2014/12/01/us-autos-loans-idUSKCN0JF2NK20141201 Ally Financial overtakes Wells Fargo as top U.S. auto lender That's probably a sign that they are the dumb money. Look at the smart money in the space (Credit Acceptance). Credit Acceptance is allowing its volume per dealer to shrink. Link to comment Share on other sites More sharing options...
jay21 Posted December 2, 2014 Share Posted December 2, 2014 http://www.reuters.com/article/2014/12/01/us-autos-loans-idUSKCN0JF2NK20141201 Ally Financial overtakes Wells Fargo as top U.S. auto lender That's probably a sign that they are the dumb money. Look at the smart money in the space (Credit Acceptance). Credit Acceptance is allowing its volume per dealer to shrink. Different markets (prime vs subprime)? But I think Aleph Blog made a good point, you probably don't want to hold debt where the issuance is high. Link to comment Share on other sites More sharing options...
ItsAValueTrap Posted December 2, 2014 Share Posted December 2, 2014 Different markets (prime vs subprime)? But I think Aleph Blog made a good point, you probably don't want to hold debt where the issuance is high. Yeah Credit Acceptance is deep subprime. Link to comment Share on other sites More sharing options...
muscleman Posted December 3, 2014 Share Posted December 3, 2014 http://www.reuters.com/article/2014/12/01/us-autos-loans-idUSKCN0JF2NK20141201 Ally Financial overtakes Wells Fargo as top U.S. auto lender That's probably a sign that they are the dumb money. Look at the smart money in the space (Credit Acceptance). Credit Acceptance is allowing its volume per dealer to shrink. Different markets (prime vs subprime)? But I think Aleph Blog made a good point, you probably don't want to hold debt where the issuance is high. Aleph blog? What's that? Link to comment Share on other sites More sharing options...
peter1234 Posted December 3, 2014 Share Posted December 3, 2014 http://www.reuters.com/article/2014/12/01/us-autos-loans-idUSKCN0JF2NK20141201 Ally Financial overtakes Wells Fargo as top U.S. auto lender That's probably a sign that they are the dumb money. Look at the smart money in the space (Credit Acceptance). Credit Acceptance is allowing its volume per dealer to shrink. Different markets (prime vs subprime)? But I think Aleph Blog made a good point, you probably don't want to hold debt where the issuance is high. Aleph blog? What's that? I assume Dave Merkels blog http://alephblog.com/ ;) Link to comment Share on other sites More sharing options...
kab60 Posted December 3, 2014 Share Posted December 3, 2014 Different markets (prime vs subprime)? But I think Aleph Blog made a good point, you probably don't want to hold debt where the issuance is high. Yeah Credit Acceptance is deep subprime. Excuse me for being slow, but I don't quiet follow. I was looking at Ally, because they're not into subprime (but still earning a good amount of money). What do you mean that they are the 'dumb' money and Credit Acceptance is the 'smart' money, if CA is deep into subprime? I'd say that's pretty dumb (well, not necessarily, depends on the risk/reward, but I'm sure you get the point). Link to comment Share on other sites More sharing options...
wknecht Posted December 3, 2014 Share Posted December 3, 2014 From the last 10-k, around 11% of Ally's loans are subprime. This is probably higher now because they are expanding in that area. If one can price and service the loans well, as CACC has proved able, being lower on the credit scale isn't necessarily "dumb" . Risk/reward as you mentioned. Easier said than done though. Yields have been falling. CACC has been passing on more loans as a result. Not familiar with details of Ally, but from the article it seems possibly Ally is not passing. I think Ally makes greater use of the securitization market though, so some of this is other people's money. Link to comment Share on other sites More sharing options...
LowIQinvestor Posted December 3, 2014 Share Posted December 3, 2014 Q3 was fairly strong, Michael Carpenter seems to be achieving the targets he laid out during the IPO. Core pre-tax income $467M Net income $423M GAAP EPS (diluted) 0.74 Adjusted EPS 0.53 ROTCE 10.3% "As of Sept. 30, 2014, Ally Bank had retail deposits of $46.7 billion, up $5.0 billion or 12 percent year-over-year, and 885,000 primary customers, an increase of 17 percent year-over-year." Link to comment Share on other sites More sharing options...
LowIQinvestor Posted December 19, 2014 Share Posted December 19, 2014 Ally’s Six-Year Bailout to End as U.S. Will Sell Stake: http://www.bloomberg.com/news/2014-12-18/ally-financial-says-u-s-to-exit-stake-sell-54-9-million-shares.html Link to comment Share on other sites More sharing options...
LowIQinvestor Posted December 22, 2014 Share Posted December 22, 2014 Anyone have the Jefferies upgrade report where they value the company at $28 a share? Or just an exec summary of the report? Link to comment Share on other sites More sharing options...
LowIQinvestor Posted December 29, 2014 Share Posted December 29, 2014 Would have thought ALLY would have been much higher following the government exit... Guess I'll just have to wait until they report Q4 numbers. Still think it goes to $30 next year. (book value) Link to comment Share on other sites More sharing options...
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