Group 1: American Express - American Express is a long-term performer and a significant holding for Warren Buffett since 1991, benefiting from a vertically integrated payments network and travel perks [3][4] - The company added 3 million new credit cards in the last quarter, which is expected to drive spending and profits [4] - Management projects annual revenue growth of 10% and earnings per share (EPS) growth at mid-teens levels, with a current price-to-earnings (P/E) ratio of 23 [5] Group 2: Occidental Petroleum - Occidental Petroleum is one of the largest oil and natural gas producers in the U.S., producing a record 1.4 million barrels of oil equivalent per day last quarter [7] - The company generated $1.5 billion in free cash flow last quarter and $4.5 billion over the past 12 months, with a market cap of $49 billion [8] - The stock is considered a long-term energy hedge unless oil prices crash, making it an attractive investment for 2025 and beyond [8] Group 3: Ally Financial - Ally Financial is a major digital bank with over $100 billion in deposits, benefiting from high interest rates on deposits compared to traditional banks [9][10] - The company is facing challenges due to rising loss rates in the automotive sector and the impact of rising interest rates, but is expected to stabilize as the Federal Reserve lowers rates [11] - Ally Financial has a P/E of around 15, and as earnings recover, the P/E is expected to decrease, leading to potential stock price increases and higher dividend payouts [12]

Financial Performance - Ally Financial reported quarterly earnings of $0.78 per share, exceeding the Zacks Consensus Estimate of $0.57 per share, and up from $0.45 per share a year ago, representing an earnings surprise of 36.84% [1] - The company posted revenues of $2.03 billion for the quarter ended December 2024, missing the Zacks Consensus Estimate by 1.90%, and down from $2.07 billion year-over-year [2] - Over the last four quarters, Ally Financial has surpassed consensus EPS estimates four times and topped consensus revenue estimates two times [2] Stock Performance - Ally Financial shares have increased approximately 6% since the beginning of the year, outperforming the S&P 500's gain of 2.9% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating it is expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.58 on revenues of $2.11 billion, and for the current fiscal year, it is $3.91 on revenues of $8.92 billion [7] - The estimate revisions trend for Ally Financial is mixed, and changes in earnings expectations may occur following the recent earnings report [6] Industry Context - The Financial - Consumer Loans industry, to which Ally Financial belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, indicating potential challenges ahead [8] - The performance of Ally Financial's stock may be influenced by the overall outlook for the industry [8]

Forward-Looking Statements and Non-GAAP Measures - The document contains forward-looking statements regarding financial and operating metrics, future capital allocation, and actions, identified by words such as "believe," "expect," and "anticipate"[3] - Non-GAAP financial measures are included in the document, which supplement GAAP results and are reconciled in the presentation[4] - Adjusted tangible book value per share (Adjusted TBVPS) is a non-GAAP measure reflecting a more conservative assessment of value by adjusting for goodwill, identifiable intangibles, Core OID balance, and Series G discount[62] - Adjusted total net revenue is a non-GAAP measure calculated by excluding Core OID from net financing revenue and adjusting other revenue for OID expenses, repositioning, and changes in fair value of equity securities[79] - Core net income attributable to common shareholders is a non-GAAP measure adjusting GAAP net income for discontinued operations, tax-effected Core OID, repositioning, and significant discrete tax items, serving as the numerator for Adjusted EPS and Core ROTCE[82] - Core original issue discount (Core OID) amortization expense is a non-GAAP measure primarily related to bond exchange OID, excluding international operations and future issuances, impacting Core pre-tax income and Adjusted EPS[83] - Core outstanding original issue discount balance (Core OID balance) is a non-GAAP measure primarily related to bond exchange OID, excluded from Core ROTCE and Adjusted TBVPS calculations[84] - Core pre-tax income is a non-GAAP measure adjusting pre-tax income by excluding Core OID, changes in fair value of equity securities, and repositioning, providing insight into core business performance[85] - Core return on tangible common equity (Core ROTCE) is a non-GAAP measure adjusting tangible common equity for Core OID balance and net DTA, reflecting the company's ability to generate returns on equity[86] - Net financing revenue excluding Core OID is a non-GAAP measure adjusting net financing revenue by excluding Core OID, primarily related to bond exchange OID, to better reflect revenue generation[92] - Tangible Common Equity is a non-GAAP measure defined as common stockholders' equity less goodwill and identifiable intangibles, adjusted for Core OID balance and net deferred tax asset in Core ROTCE calculations[95] Financial Performance and Metrics - Net financing revenue for Q4 2024 was $1,509 million, a decrease of $11 million compared to Q3 2024 and an increase of $7 million compared to Q4 2023[8] - Adjusted other revenue for Q4 2024 was $564 million, an increase of $8 million compared to Q3 2024 and $64 million compared to Q4 2023[8] - Provision for credit losses in Q4 2024 was $557 million, a decrease of $88 million compared to Q3 2024 and $30 million compared to Q4 2023[8] - Total noninterest expense for Q4 2024 was $1,360 million, an increase of $135 million compared to Q3 2024 and a decrease of $56 million compared to Q4 2023[8] - Net income attributable to common shareholders for Q4 2024 was $81 million, a decrease of $90 million compared to Q3 2024 and an increase of $46 million compared to Q4 2023[8] - Total assets at the end of Q4 2024 were $191,836 million, a decrease of $834 million compared to Q3 2024 and $4,493 million compared to Q4 2023[8] - Consumer loans at the end of Q4 2024 were $103,285 million, an increase of $190 million compared to Q3 2024 and a decrease of $1,692 million compared to Q4 2023[8] - Net interest margin for Q4 2024 was 3.30%, an increase of 0.01% compared to Q3 2024 and 0.11% compared to Q4 2023[8] - Common Equity Tier 1 (CET1) capital ratio at the end of Q4 2024 was 9.8%, unchanged from Q3 2024 and an increase of 0.4% compared to Q4 2023[8] - Adjusted earnings per share for Q4 2024 was $0.78, an increase of $0.35 compared to Q3 2024 and $0.39 compared to Q4 2023[8] - Total financing revenue and other interest income decreased by $78 million (2.2%) compared to 3Q 24 and $104 million (2.9%) compared to 4Q 23, totaling $3,528 million in 4Q 24[13] - Net financing revenue for 4Q 24 was $1,509 million, a decrease of $11 million (0.7%) from 3Q 24 but an increase of $7 million (0.5%) from 4Q 23[13] - Total interest expense decreased by $86 million (4.6%) compared to 3Q 24 and $109 million (5.7%) compared to 4Q 23, totaling $1,799 million in 4Q 24[13] - Net income available to common shareholders for 4Q 24 was $81 million, a decrease of $90 million (52.6%) from 3Q 24 but an increase of $46 million (131.4%) from 4Q 23[13] - Total assets decreased by $834 million (0.4%) compared to 3Q 24 and $4,493 million (2.3%) compared to 4Q 23, totaling $191,836 million in 4Q 24[17] - Total deposit liabilities decreased by $376 million (0.2%) compared to 3Q 24 and $3,092 million (2.0%) compared to 4Q 23, totaling $151,574 million in 4Q 24[17] - Total equity decreased by $511 million (3.5%) compared to 3Q 24 but increased by $200 million (1.5%) compared to 4Q 23, totaling $13,903 million in 4Q 24[17] - Insurance premiums and service revenue earned increased by $9 million (2.5%) compared to 3Q 24 and $33 million (9.9%) compared to 4Q 23, totaling $368 million in 4Q 24[13] - Provision for loan losses decreased by $88 million (13.6%) compared to 3Q 24 and $30 million (5.1%) compared to 4Q 23, totaling $557 million in 4Q 24[13] - Total noninterest expense increased by $135 million (11.0%) compared to 3Q 24 but decreased by $56 million (4.0%) compared to 4Q 23, totaling $1,360 million in 4Q 24[13] - Total assets decreased by $1.9 billion in FY 2024 compared to FY 2023, from $194.165 billion to $192.266 billion[20] - Total finance receivables and loans, net decreased by $3.69 billion in 4Q 2024 compared to 4Q 2023, from $140.326 billion to $136.636 billion[20] - Pre-tax income from continuing operations decreased by $267 million in FY 2024 compared to FY 2023, from $1.103 billion to $836 million[24] - Automotive Finance pre-tax income decreased by $398 million in FY 2024 compared to FY 2023, from $2.214 billion to $1.816 billion[24] - Core pre-tax income decreased by $198 million in FY 2024 compared to FY 2023, from $1.246 billion to $1.047 billion[24] - Total interest-bearing deposit liabilities decreased by $199 million in FY 2024 compared to FY 2023, from $152.915 billion to $152.716 billion[20] - Investment in operating leases, net decreased by $1.768 billion in FY 2024 compared to FY 2023, from $9.901 billion to $8.133 billion[20] - Retail deposit liabilities increased by $3.426 billion in FY 2024 compared to FY 2023, from $138.968 billion to $142.394 billion[20] - Long-term debt decreased by $2.42 billion in FY 2024 compared to FY 2023, from $19.226 billion to $16.806 billion[20] - Corporate Finance pre-tax income increased by $80 million in FY 2024 compared to FY 2023, from $354 million to $434 million[24] - Net financing revenue for Q4 2024 was $1,344 million, a decrease of $23 million compared to Q3 2024 and a decrease of $38 million compared to Q4 2023[28] - Total financing revenue and other interest income for Q4 2024 was $2,654 million, a decrease of $15 million compared to Q3 2024 but an increase of $80 million compared to Q4 2023[28] - Consumer loans at the end of Q4 2024 were $83,808 million, an increase of $412 million compared to Q3 2024 but a decrease of $606 million compared to Q4 2023[28] - Commercial loans at the end of Q4 2024 were $22,898 million, a decrease of $944 million compared to Q3 2024 and a decrease of $436 million compared to Q4 2023[28] - Total assets at the end of Q4 2024 were $113,057 million, a decrease of $526 million compared to Q3 2024 and a decrease of $2,244 million compared to Q4 2023[28] - Provision for credit losses for Q4 2024 was $495 million, a decrease of $84 million compared to Q3 2024 and an increase of $3 million compared to Q4 2023[28] - Total net revenue for Q4 2024 was $1,432 million, a decrease of $20 million compared to Q3 2024 and a decrease of $32 million compared to Q4 2023[28] - Net lease revenue for Q4 2024 was $130 million, a decrease of $17 million compared to Q3 2024 and a decrease of $28 million compared to Q4 2023[28] - The company updated its corporate overhead allocation methodology in Q4 2024 to better reflect how the Chief Operating Decision Maker views and operates the business[28] - Prior period results for 2023 and 2024 have been retrospectively adjusted to reflect a change in the method of accounting for investment tax credits related to electric vehicle lease originations[29] - U.S. Consumer Originations for FY 2024 totaled $39.2 billion, a decrease of $0.8 billion compared to FY 2023[31] - Retail standard - new vehicle GM originations in FY 2024 were $4.2 billion, down $0.1 billion from FY 2023[31] - Used vehicle originations in FY 2024 were $24.5 billion, a decrease of $1.3 billion compared to FY 2023[31] - Super prime (760-999 FICO) originations in FY 2024 were $11.2 billion, an increase of $2.2 billion from FY 2023[31] - Total Active DFS Dealers as of 4Q 2024 were 21,787, a decrease of 461 compared to 4Q 2023[31] - Total Application Volume in FY 2024 was 14,607,000, an increase of 775,000 from FY 2023[31] - Floorplan outstandings in 4Q 2024 were $16.4 billion, a decrease of $1.1 billion compared to 3Q 2024[31] - Off-lease vehicles terminated - on-balance sheet in FY 2024 were 127,861 units, an increase of 18,105 units from FY 2023[31] - Average gain per vehicle in FY 2024 was $1,033, a decrease of $890 compared to FY 2023[31] - Total gain from off-lease remarketing in FY 2024 was $211 million, a decrease of $79 million from FY 2023[31] - Combined ratio for the year improved to 92.5%, compared to 100.6% in the previous year[33] - Total net revenue increased to $1,621 million in FY 2024, up from $1,532 million in FY 2023, a growth of $89 million[33] - Insurance premiums and service revenue earned rose to $1,413 million in FY 2024, an increase of $142 million from $1,271 million in FY 2023[33] - Net financing revenue grew to $456 million in FY 2024, up by $26 million from $430 million in FY 2023[38] - Total assets decreased to $9,704 million in 4Q 2024, down by $694 million from $10,398 million in 3Q 2024[38] - Loss ratio for the year stood at 31.3%, compared to 37.1% in the previous year[33] - Total written premiums and revenue increased to $1,472 million in FY 2024, up by $198 million from $1,274 million in FY 2023[33] - Pre-tax income rose to $434 million in FY 2024, an increase of $80 million from $354 million in FY 2023[38] - Compensation and benefits expense remained stable at $108 million in both FY 2024 and FY 2023[33] - Total noninterest expense increased to $1,453 million in FY 2024, up by $137 million from $1,316 million in FY 2023[33] - Net financing revenue decreased by $54 million in Q4 24 compared to Q3 24, totaling $592 million[40] - Interest expense dropped by $59 million in Q4 24 compared to Q3 24, reaching $573 million[40] - Total net revenue for Q4 24 was $67 million, a decrease of $3 million from Q3 24[40] - Provision for loan losses increased by $12 million in Q4 24 compared to Q3 24, totaling $67 million[40] - Compensation and benefits expense rose by $9 million in Q4 24 compared to Q3 24, reaching $235 million[40] - Goodwill impairment of $118 million was recorded in Q4 24, compared to none in Q3 24[40] - Total noninterest expense increased by $132 million in Q4 24 compared to Q3 24, totaling $444 million[40] - Pre-tax loss for Q4 24 was $444 million, an increase of $147 million from Q3 24[40] - Cash, trading, and investment securities increased by $224 million in Q4 24 compared to Q3 24, reaching $32,599 million[40] - Consumer loans decreased by $222 million in Q4 24 compared to Q3 24, totaling $19,477 million[40] - Ending loan balance decreased to $136,030 million in 4Q 24, down $1,471 million from 3Q 24 and $3,409 million from 4Q 23[43] - 30+ Accruing DPD increased to $3,800 million in 4Q 24, up 4.25% from 3Q 24 and down 1.45% from 4Q 23[43] - Net charge-offs rose to $543 million in 4Q 24, up 5.03% from 3Q 24 and down 12.84% from 4Q 23[43] - Net charge-off rate increased to 1.59% in 4Q 24, up from 1.50% in 3Q 24 and down from 1.77% in 4Q 23[43] - Provision for loan losses decreased to $557 million in 4Q 24, down 13.64% from 3Q 24 and 5.11% from 4Q 23[43] - ALLL as % of Loans increased to 2.73% in 4Q 24, up from 2.69% in 3Q 24 and 2.57% in 4Q 23[43] - U.S. Auto 30+ Delinquent contract $ increased to $3,681 million in 4Q 24, up 4.16% from 3Q 24 and down 1.31% from 4Q 23[43] - U.S. Auto Annualized Net Charge-Offs increased to $488 million in 4Q 24, up 4.50% from 3Q 24 and 3.83% from 4Q 23[43] - Consumer Allowance for loan losses increased to $3,170 million in 4Q 24, up $4 million from 3Q 24 and $87 million from 4Q 23[46] - Consumer Other – Ally Credit Card Allowance for loan losses increased to $319 million in 4Q 24, up $12 million from 3Q 24 and $26 million from 4Q 23[46] - Risk-weighted assets decreased to $153.4 billion in 4Q 24, down $2.9 billion from 3Q 24 and $8.2 billion from 4Q 23[48] - Common Equity Tier 1 (CET1) capital ratio remained stable at 9.8% in 4Q 24, unchanged from 3Q 24 and up from 9.4% in 4Q 23[48] - Total capital ratio increased to 13.2% in 4Q 24, up from 12.9% in 3Q 24 and 12.4% in 4Q 23[48] - Tangible common equity / Tangible assets ratio decreased to 5.7% in 4Q 24, down from 5.9% in 3Q 24 but up from 5.4% in 4Q 23[48] - Total current available liquidity increased to $68.5 billion in 4Q 24, up $0.5 billion from 3Q 24 and $5.0 billion from 4Q 23[52] - Retail deposits increased to $143,430 million in 4Q 24, up $1,981 million from 3Q 24 and $1,165 million from 4Q 23[52

Group 1 - Ally Financial Inc. has entered into a definitive agreement to sell its credit card business to CardWorks, which includes a portfolio of $2.3 billion in credit card receivables and 1.3 million active cardholders as of December 31, 2024 [1][2] - The sale is part of Ally's strategy to focus on its core businesses, simplify its structure, and drive improved returns, according to CEO Michael Rhodes [2] - CardWorks views the acquisition as an exciting step in expanding its near-prime credit card business and has been a servicing partner to Ally's platform since its inception [2] Group 2 - The transaction is expected to close in 2025, pending customary closing conditions [2] - J.P. Morgan Securities LLC acted as the financial advisor for Ally, while Sullivan & Cromwell LLP served as its legal advisor [3] - CardWorks has been a leader in credit and payments for over 38 years, focusing on a people-first approach and innovative use of data and technology [6]

Core Insights - Ally Financial Inc. reported its fourth quarter and full year 2024 results, indicating a significant performance review [1] - The company will host a conference call to discuss the results, which will include a question and answer session [1][2] Company Overview - Ally Financial Inc. is a financial services company known for having the largest all-digital bank in the nation and an industry-leading auto financing business [4] - The company serves approximately 10 million customers, offering services such as deposits, securities brokerage, investment advisory, auto financing, and insurance [4] - Ally also has a corporate finance business that provides capital for equity sponsors and middle-market companies [4]

Group 1 - Ally Financial became a standalone company in 2014, originally as the auto finance arm of General Motors, and has a business model focused on auto loans [1][2] - The company offers a range of products including auto loans, insurance, banking, credit cards, investments, and mortgage lending, but is heavily concentrated in the auto loan sector [2][3] - In 2023, approximately 58% of Ally Financial's loans were in the auto market, indicating a significant reliance on this sector compared to other banks [3] Group 2 - Ally Financial's financing is heavily dependent on a few auto brands, with General Motors and Stellantis accounting for about 80% of its new vehicle dealer inventory financing in 2023 [4] - The company is in the process of shutting down its mortgage operations and seeking buyers for its credit card business, indicating a strategic shift to focus on its core auto lending business [5][6] - This shift may lead to a less diversified operation, increasing vulnerability to issues in the auto industry, such as sales slowdowns or rising default rates [6][8] Group 3 - Despite the concentration risk, Ally Financial has an investment-grade rated balance sheet and potential for long-term growth in auto lending, which could make it an attractive investment [7] - The company offers a well-above-market yield of 3.3%, providing attractive compensation for investors [7] - Investors should be prepared for volatility due to the concentrated nature of Ally Financial's business model, which may lead to performance challenges in the short term [9]

Core Viewpoint - Analysts expect Ally Financial (ALLY) to report quarterly earnings of $0.59 per share, reflecting a year-over-year increase of 31.1%, with revenues projected at $2.06 billion, a slight decline of 0.4% from the previous year [1]. Earnings Estimates - Over the last 30 days, the consensus EPS estimate has been revised downward by 1.2%, indicating a collective reassessment by analysts [2]. - Revisions to earnings projections are crucial for predicting investor behavior and are strongly correlated with short-term stock price performance [3]. Key Financial Metrics - Analysts forecast 'Gain on mortgage and automotive loans, net' to be $5.47 million, an increase of 82.3% year-over-year [5]. - 'Total other revenue' is expected to reach $589.53 million, reflecting a 2.7% increase from the prior year [5]. - 'Insurance premiums and service revenue earned' is projected at $363.73 million, an 8.6% increase year-over-year [6]. - 'Total financing revenue and other interest income' is estimated at $3.59 billion, indicating a 1% decline from the previous year [6]. - 'Other (loss) / gain on investments, net' is expected to be $52.65 million, showing a significant decrease of 38.1% year-over-year [6]. - 'Other income, net of losses' is anticipated to be $163.19 million, an increase of 8.1% from the prior year [7]. - The consensus estimate for 'Net interest margin (as reported)' remains at 3.2%, unchanged from the previous year [7]. - 'Efficiency Ratio' is forecasted to improve to 58.3%, down from 68.5% in the same quarter last year [7]. Asset and Capital Ratios - 'Total interest-earning assets (Average Balances)' are projected at $184.61 billion, down from $186.96 billion reported in the same quarter last year [8]. - 'Non-performing loans (NPLs)' are estimated at $1.23 billion, a decrease from $1.39 billion in the previous year [8]. - The 'Total Capital Ratio' is expected to reach 12.7%, up from 12.4% reported last year [9]. - The 'Tier 1 Capital Ratio' is projected at 11.0%, compared to 10.8% in the same quarter last year [9]. Stock Performance - Ally Financial shares have returned +7.3% over the past month, outperforming the Zacks S&P 500 composite, which has seen a -3.3% change [10].

Core Insights - The banking sector had a strong performance in the previous year, with the Dow Jones U.S. Banks Index gaining 37%, outperforming the S&P 500's 25% gain, aided by the Federal Reserve's interest rate cut in September [1] Company Overview - Ally Financial is recognized as the largest all-digital bank in the U.S., having been spun off from General Motors in 2010, leveraging a first-mover advantage and extensive data [3] - The bank has a significant presence in the auto lending market, originating $9.5 billion in auto loans in the third quarter, with expectations of 14 million applications for the full year, up from 13.8 million last year [6] Customer Base and Growth - Ally added 57,000 net new deposit customers in the third quarter, bringing the total to 3.3 million, with a high retention rate of 95% [4] - A notable 74% of new members are from Millennial and Gen Z demographics, indicating strong engagement and long-term growth potential [5] Financial Performance - Despite recent pressures, Ally reported rising earnings per share and return on tangible common equity in the third quarter, although the market remains cautious about smaller banks [8] - The stock is currently trading at a low price-to-book ratio of about 0.9 and a forward one-year P/E ratio of 6, with a dividend yield of 3.4%, which is higher than most bank stocks [9] Market Position and Future Outlook - Ally has adopted more conservative lending practices in response to rising default rates, with a weighted average FICO credit score for auto loans at 710, and a decrease in approval rates from 30% to 28% [7] - The company has long-term advantages in its digital platform and robust auto loan business, suggesting potential value for investors [10]

Company Overview - Ally Financial (ALLY) is expected to report a year-over-year increase in earnings, with a projected quarterly earnings of $0.59 per share, reflecting a +31.1% change [3] - Revenues are anticipated to reach $2.08 billion, which is a 0.8% increase from the previous year [3] Earnings Expectations - The upcoming earnings report is scheduled for January 22, and the stock may rise if the reported numbers exceed expectations, while a miss could lead to a decline [2] - The consensus EPS estimate has been revised down by 2.42% over the last 30 days, indicating a bearish sentiment among analysts [4][10] Earnings Surprise Prediction - The Most Accurate Estimate for Ally Financial is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -6.41%, which complicates the prediction of an earnings beat [11] - Despite a Zacks Rank of 3 (Hold), the combination of a negative Earnings ESP makes it challenging to predict a positive outcome [11] Historical Performance - In the last reported quarter, Ally Financial exceeded the expected earnings of $0.57 per share by delivering $0.95, resulting in a surprise of +66.67% [12] - Over the past four quarters, the company has consistently beaten consensus EPS estimates [13] Industry Context - In the broader context of the Zacks Financial - Consumer Loans industry, Capital One (COF) is also expected to report earnings of $2.68 per share, reflecting a +19.6% year-over-year change, with revenues projected at $10.13 billion, up 6.6% [17] - Capital One's consensus EPS estimate has been revised down by 2% in the last 30 days, leading to an Earnings ESP of -5.66%, similar to Ally Financial's situation [18]

Core Viewpoint - Ally Financial is exiting the mortgage origination business and seeking strategic alternatives for its credit card business due to persistently high mortgage rates and a challenging operating environment [1][3][8]. Business Restructuring - The company plans to fully exit both the mortgage and credit card businesses by the end of the current quarter [1]. - As part of this restructuring, Ally Financial will lay off less than 5% of its employees, although specific locations or operations affected have not been disclosed [2]. Mortgage Origination Insights - Ally Bank, a subsidiary of Ally Financial, has shifted its focus from originating mortgages to primarily originating for sale on the secondary mortgage market [3]. - The company's mortgage origination volume has decreased significantly, with over 70% of direct-to-consumer originations coming from existing depositors, indicating a lack of active business expansion efforts [6]. Credit Card Business Evaluation - After reviewing growth areas, Ally Financial concluded that the credit card business is not a priority for further investment [7]. - As of September 30, 2024, the company reported $2.13 billion in average credit card loans and 1.25 million active cardholders [7]. Focus on Core Business - Following the reorganization, Ally Financial will concentrate on its auto franchise, which is its largest and original business [8]. Financial Performance and Projections - The company is facing challenges related to asset quality and higher interest rates, which have impacted consumer behavior and led to increased volatility in credit costs and margins [9]. - Ally Financial anticipates an increase in loan losses for 2024, with retail auto net charge-off rates projected between 2.25% and 2.30%, up from a previous target of 2.1% [10]. - The consolidated net charge-offs are expected to be in the range of 1.50-1.55%, an increase from earlier guidance of 1.45-1.5% [10]. Net Interest Margin Adjustments - Due to near-term headwinds, Ally Financial has lowered its net interest margin (NIM) target for 2024 to approximately 3.20%, down from an earlier estimate of 3.30% [11]. - The NIM for 2023 was reported at 3.32% [11]. Market Performance Context - Investors have become bearish on Ally Financial stock, with shares gaining only 4.1% last year, significantly underperforming the Zacks Consumer Loan industry's rally of 34.3% [13]. - In contrast, peers such as Capital One and SLM Corp. experienced substantial stock price increases in 2024, with gains of 36% and 44.2%, respectively [13].