IGM Financial vs Ally Financial Which Is More Promising?

IGM Financial and Ally Financial are two prominent players in the financial services sector, with each having its unique strengths and opportunities for growth. IGM Financial is a leading wealth and asset management company with a strong presence in the Canadian market, while Ally Financial is a digital financial services firm known for its innovative banking products and services. Both companies have shown resilience and adaptability in the face of market challenges, making their stocks of interest to investors seeking stability and growth potential.

IGM Financial or Ally Financial?

When comparing IGM Financial and Ally Financial, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between IGM Financial and Ally Financial.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. IGM Financial has a dividend yield of 5.25%, while Ally Financial has a dividend yield of 3.99%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. IGM Financial reports a 5-year dividend growth of -0.25% year and a payout ratio of 50.11%. On the other hand, Ally Financial reports a 5-year dividend growth of 16.47% year and a payout ratio of 54.41%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with IGM Financial P/E ratio at 9.83 and Ally Financial's P/E ratio at 13.05. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. IGM Financial P/B ratio is 1.49 while Ally Financial's P/B ratio is 0.78.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, IGM Financial has seen a 5-year revenue growth of 0.14%, while Ally Financial's is 1.15%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with IGM Financial's ROE at 15.87% and Ally Financial's ROE at 6.31%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $31.18 for IGM Financial and $37.49 for Ally Financial. Over the past year, IGM Financial's prices ranged from $22.81 to $31.82, with a yearly change of 39.50%. Ally Financial's prices fluctuated between $25.23 and $45.46, with a yearly change of 80.18%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.