Is Ally Financial a No-Brainer Dividend Stock for This Bull Market?
Markets have been volatile ever since the beginning of the global pandemic in March 2020. Stocks have gone on wild upward and downward rides, which can increase your stress as an investor. Today, stocks in the U.S. are closing in on all-time highs, signaling that we may be entering a new bull market. However, that does not mean you should go all in chasing the growth stocks that have soared 100% this year. Students of financial history know the market is bipolar and changes its mood on a dime.
One way to dampen the effects of volatility in your portfolio is to buy stocks with high dividend yields that give you a steady income stream. Ally Financial (NYSE: ALLY) has an attractive dividend yield of close to 4% and a history of raising its payout to shareholders. Let's see if this is a safe bet for investors looking for dividend stocks in the 2023 market rally.
Ally has a peculiar history. It used to be the financial arm of General Motors, but was spun out after the division took on bad mortgage loans during the financial crisis in 2008. As a separate business, Ally Financial still focuses on automotive lending but has added a second pillar to its operations: consumer banking. At the end of the last quarter, Ally had $140 billion in retail deposits, which it uses to fund car loans.
Source Fool.com
