Analysts are Downgrading These 5 Stocks

In this article, we discuss the 5 stocks recently downgraded by analysts. If you want to see some other stocks on the list, go directly to Analysts are Downgrading These 11 Stocks.

5. Ally Financial Inc. (NYSE:ALLY)

Number of Hedge Fund Holders: 42

Shares of Ally Financial Inc. (NYSE:ALLY) slipped over two percent after the opening bell on Thursday, October 6. The drop came after Raymond James downgraded the financial services company from “Outperform” to “Market Perform.”

Analyst Michael Long believes increasing macro uncertainty could potentially lead to higher loan losses, hurting the growth of financial stocks, including Ally Financial Inc. (NYSE:ALLY). Long also cautioned about a possible compression in net interest margin.

Separately, Ally Financial Inc. (NYSE:ALLY) appeared in the second-quarter 2022 investor letter of investment management firm Oakmark Funds. Here’s what the firm said:

“As for Ally Financial, fears of a recession drove the stock price down more than 20% for the period, but business fundamentals have remained strong and the shares now trade for just a mid-single-digit multiple of current earnings. We believe today’s price ignores the funding cost improvements and well-capitalized nature of Ally’s balance sheet. We continue to own both investments given their significant discounts to our estimates of business value.”