Tag: Goldman

You know we are near or at a market top when shit stains like Ally Financial are brought public by fellow shit stains – Citi, Goldman, and Morgan Stanley. You’d have to be brain dead or an Ivy League trained economist to buy this turd sandwich at $25 per share. You’d have to be retarded shit eating muppet to buy this worthless government manipulated joke of a company. This is the company that has been doling out billions in subprime auto loans to the Free Shit Army for the last three years in order to prop up General Motors auto sales. They have been doing this because Obama and his minions instructed them to do so. Now that they are loaded with hundreds of billions in loans that will never be repaid, Obama is dumping this piece of shit on the public market where the Wall Street shysters will try to convince you to buy it. Jim Cramer thinks it’s the bomb.

I decided to go to their last SEC filing to get the real scoop about this joke. Here is the link:

http://www.ally.com/about/investor/earnings-releases/

Here are my pithy observations:

• You need to go to page 27 & 28 of their 29 page PR presentation to find out they LOST $190 million in the 4th quarter and $910 million for all of FY13.
• This is a fabulous improvement over the $1.6 billion they LOST in FY12.
• These government cronies have increased their auto loans outstanding by 100% since 2009 to $108 BILLION.
• Page 14 of the presentation is the smoking gun. They had $843 million of delinquent auto loans in the 1st quarter of 2013. By the 4th quarter of 2013 delinquent loans had risen to $1.325 BILLION. That is a 57% increase in one year. SHOCKING!!! Considering they have been making loans to deadbeats who can barely scratch an X on the loan document. Do you think this trend is going to reverse in the 1st quarter of 2014? Do you understand why they are doing the IPO now, before reporting 1st quarter results?
• They don’t even show their balance sheet in the main presentation. You need to go to the supplemental info. It’s a doozy.
  • They have over $100 billion in loans with only a $1 billion loan loss reserve. Yeah that should work out real well.
  • They have $14 billion of equity and only $77 billion of debt. Sounds like a fantastic once in a lifetime investment opportunity.

What do you think is going to happen when the $54 billion of subprime auto loans they’ve doled out over the last four years start to really go south? What do you think will happen as interest rates on their debt ratchet upwards? If they are already losing almost a billion per year, the future will be epic.

They originally filed to go public in March 2011. I wonder what took so long. I guess they wanted to get their loss under $1 billion before allowing the masses to buy into their success story.

But I’m probably wrong. Facts don’t matter. This is a fantastic investment opportunity for the muppets. Step right up and buy some Ally Financial. You bailed them out once, why not do it again?

Ally Financial Inc. (ALLY) priced its initial public offering at $25 a share after markets closed on Wednesday. The IPO price was at the low end of the expected range. The company sold 95 million shares Thursday morning for gross proceeds of $2.38 billion.

The low-end pricing of the stock is just another poke in the eye to U.S. taxpayers. All the proceeds will be used to pay back the U.S. Treasury’s $17 billion bailout of the company known as GMAC back in 2008 when the financial crisis hit. Thursday’s sale reduces the federal government stake in the company from about 38% to around 14%.

Underwriters are Citigroup, Goldman Sachs, Morgan Stanley and Barclays Capital, which have an overallotment option on an additional 14.25 million shares.

One analyst at BTIG has already put a Buy recommendation on the bank’s stock with a price target of $31 a share, according to a report at TheStreet.com. That is arguable given that Ally failed its most recent Federal Reserve stress test and has set up a subsidiary on which the bank intends to shed all its bad loans.

Ally also has about $79 billion in remaining debt that the bank has to roll over constantly as the principal payments come due. From Ally’s point of view, if interest rates never rise about 0.25%, it is all right with the bank.

Shares opened down 3% at $24.25 and have since picked up slightly to $24.57.