Ally Financial bull/bear debate brings buying opportunity, says Citi

Citi analyst Keith Horowitz says the bull/bear debate on Ally Financial (ALLY) has intensified in recent days. Given the company’s history, there is a “high degree of skepticism” on the financial targets given by management, the analyst tells investors in a research note. The firm views this as a buying opportunity, saying Ally’s path to improved returns will clearer in Q4. One of the primary debates is the ability for the company to hit its 3.80% net interest margin target, according to Citi. However, the firm views the achievement as “very attainable,” even when holding rates flat from here. The second debate is on credit, and Citi remains “very constructive” that Ally’s losses will be at top end of normalized auto loss range. Citi says Ally Financial remains a top pick with a Buy rating and $55 price target