‘Buy The Dip' Bank Signal Has Never Been Wrong

Core Viewpoint - Ally Financial (ALLY) stock experienced a significant decline of 17.1% on September 10 due to a severe credit warning, but managed to recover to a 3.2% loss by the end of the month, and was subsequently added to Citi's Focus List as a top pick [1] Group 1: Stock Performance - After the initial drop, Ally's stock has shown a historically bullish signal, with a potential average increase of 6.7% over the next month when trading within one standard deviation of its 320-day moving average [1] - The stock is currently trading well below its year-to-date high of $45.46, and is just below its 2024 breakeven level, but has increased by 30.1% over the last 12 months [2] Group 2: Analyst Sentiment - Analysts believe that Ally is well-positioned to benefit from improving credit conditions and an expanding net interest margin (NIM) [1] - There is a prevailing pessimism among analysts, with 10 out of 19 covering brokerages recommending a "hold" or worse rating, indicating potential for unwinding of this sentiment to provide tailwinds for the stock [2]