Ally Financial price target raised to $31 from $30 at Piper Sandler

Piper Sandler analyst Kevin Barker raised the firm’s price target on Ally Financial to $31 from $30 and keeps a Neutral rating on the shares ahead of the Q3 report. Consumer lenders and payments companies have underperformed the market in recent months as higher rates have increased near-term recession fears, the analyst tells investors in a research note. The firm believes a recession with rising unemployment “remains a significant overhang for consumer lenders and the market in general.” In addition, Piper has become increasingly concerned higher interest rates and the re-start of student debt payments could present an incremental headwind to spending in early 2024. It expects these headwinds to keep valuation multiples “subdued” in the near-term before improving comps can lead to more reasonable multiples.