How much will Ally Financial owe in February?
By Gabriel Shpitalnik | Macroaxis Story |
Ally Financial is scheduled to announce its earnings today. The next earnings report is expected on the 19th of April 2021. The stock is in a buyout trend. Ally Financial Book Value per Share is fairly stable at the moment as compared to the past year. Ally Financial reported Book Value per Share of 34.14 in 2020. EBITDA Margin is likely to rise to 0.57 in 2021, whereas Net Income Per Employee is likely to drop slightly above 143.2 K in 2021. While some of us are becoming more enthusiastic about financial services space, let's break down Ally Financial in greater detail to make a better estimate of its debt utilization. We will inspect if it could be a much better year for Ally Financial shareholders.
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Reviewed by Vlad Skutelnik
Ally Financial currently holds 28.91 B in liabilities with Debt to Equity (D/E) ratio of 275.8, indicating Ally Financial may have difficulties to generate enough cash to satisfy its financial obligations. The entity has a current ratio of 0.83, indicating that it has a negative working capital and may not be able to pay financial obligations when due. Ally Financial financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Ally Financial, including all of Ally Financial's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Ally Financial assets, the company is considered highly leveraged. Understanding the composition and structure of overall Ally Financial debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.
Understanding Ally Total Debt
Ally Financial liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Ally Financial has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Ally Financial balance sheet include debt obligations and money owed to different Ally Financial vendors, workers, and loan providers. Below is the chart of Ally main long-term debt accounts currently reported on its balance sheet. You can use Ally Financial financial leverage analysis tool to get a better grip on understanding its financial positionHow important is Ally Financial's Liquidity
Ally Financial financial leverage refers to using borrowed capital as a funding source to finance Ally Financial ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Ally Financial financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Ally Financial's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Ally Financial's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Ally Financial's total debt and its cash.
An Additional Perspective On Ally Financial
The firm reported the previous year's revenue of 5.67 B. Net Income was 780 M with profit before overhead, payroll, taxes, and interest of 6.38 B.
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This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Gabriel Shpitalnik do not own shares of Ally Financial. Please refer to our Terms of Use for any information regarding our disclosure principles.