NasdaqGS:CACC

Stock Analysis Report

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Executive Summary

Credit Acceptance Corporation provides financing programs, and related products and services to independent and franchised automobile dealers in the United States. More Details


Snowflake Analysis

Good value with reasonable growth potential.


Similar Companies

Share Price & News

How has Credit Acceptance's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CACC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

0.5%

CACC

-2.8%

US Consumer Finance

-1.1%

US Market


1 Year Return

-23.9%

CACC

-17.8%

US Consumer Finance

15.6%

US Market

Return vs Industry: CACC underperformed the US Consumer Finance industry which returned -14.9% over the past year.

Return vs Market: CACC underperformed the US Market which returned 17.8% over the past year.


Shareholder returns

CACCIndustryMarket
7 Day0.5%-2.8%-1.1%
30 Day10.3%7.7%4.2%
90 Day-27.9%8.1%6.3%
1 Year-23.9%-23.9%-16.0%-17.8%18.2%15.6%
3 Year13.0%13.0%-2.3%-7.3%39.6%30.4%
5 Year70.9%70.9%21.5%11.5%79.5%59.2%

Price Volatility Vs. Market

How volatile is Credit Acceptance's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Credit Acceptance undervalued compared to its fair value and its price relative to the market?

29.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CACC ($334.54) is trading below our estimate of fair value ($472.45)

Significantly Below Fair Value: CACC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CACC is poor value based on its PE Ratio (18.1x) compared to the US Consumer Finance industry average (12.4x).

PE vs Market: CACC is good value based on its PE Ratio (18.1x) compared to the US market (19.1x).


Price to Earnings Growth Ratio

PEG Ratio: CACC is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: CACC is overvalued based on its PB Ratio (2.9x) compared to the US Consumer Finance industry average (1.1x).


Next Steps

Future Growth

How is Credit Acceptance forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

31.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CACC's forecast earnings growth (31.8% per year) is above the savings rate (2.2%).

Earnings vs Market: CACC's earnings (31.8% per year) are forecast to grow faster than the US market (22.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: CACC's revenue (14.7% per year) is forecast to grow faster than the US market (9.9% per year).

High Growth Revenue: CACC's revenue (14.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if CACC's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Credit Acceptance performed over the past 5 years?

14.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CACC has high quality earnings.

Growing Profit Margin: CACC's current net profit margins (41.6%) are lower than last year (54.5%).


Past Earnings Growth Analysis

Earnings Trend: CACC's earnings have grown by 14.5% per year over the past 5 years.

Accelerating Growth: CACC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: CACC had negative earnings growth (-46.2%) over the past year, making it difficult to compare to the Consumer Finance industry average (-25.8%).


Return on Equity

High ROE: CACC's Return on Equity (16.5%) is considered low.


Next Steps

Financial Health

How is Credit Acceptance's financial position?


Financial Position Analysis

Short Term Liabilities: CACC's short term assets ($7.2B) exceed its short term liabilities ($181.3M).

Long Term Liabilities: CACC's short term assets ($7.2B) exceed its long term liabilities ($5.1B).


Debt to Equity History and Analysis

Debt Level: CACC's debt to equity ratio (232.3%) is considered high.

Reducing Debt: CACC's debt to equity ratio has increased from 224.6% to 232.3% over the past 5 years.

Debt Coverage: CACC's debt is not well covered by operating cash flow (19.1%).

Interest Coverage: Insufficient data to determine if CACC's interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is Credit Acceptance current dividend yield, its reliability and sustainability?

1.79%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate CACC's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate CACC's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CACC's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CACC's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CACC's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

7.2yrs

Average management tenure


CEO

Brett Roberts (54 yo)

18.75yrs

Tenure

US$1,039,000

Compensation

Mr. Brett A. Roberts has been the Chief Executive Officer of Credit Acceptance Corp. since January 2002. Mr. Roberts served as the President of Credit Acceptance Corp. from August 24, 2006 to April 2, 2007 ...


CEO Compensation Analysis

Compensation vs Market: Brett's total compensation ($USD1.04M) is below average for companies of similar size in the US market ($USD7.31M).

Compensation vs Earnings: Brett's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Brett Roberts
CEO & Director18.75yrsUS$1.04m2.34%
$ 139.2m
Kenneth Booth
Chief Financial Officer15.83yrsUS$2.92m0.11%
$ 6.4m
Charles Pearce
Chief Legal Officer & Corporate Secretary15.83yrsUS$2.92m0.020%
$ 1.2m
Daniel Ulatowski
Chief Sales Officer6.75yrsUS$2.92m0.069%
$ 4.1m
Arthur Smith
Chief Analytics Officer7.17yrsUS$2.92m0.064%
$ 3.8m
Jonathan Lum
Chief Operating Officer1.42yrsno data0.048%
$ 2.9m
Noah Kotch
Chief Information Officer1.42yrsno data0.013%
$ 769.3k
Douglas Busk
Treasurerno datano data0.016%
$ 965.3k

7.2yrs

Average Tenure

51.5yo

Average Age

Experienced Management: CACC's management team is seasoned and experienced (7.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Brett Roberts
CEO & Director18.75yrsUS$1.04m2.34%
$ 139.2m
Thomas Tryforos
Independent Lead Director3.75yrsUS$21.50k2.43%
$ 145.0m
Scott Vassalluzzo
Independent Director13.58yrsno data0.35%
$ 21.0m
Glenda Flanagan
Independent Director16.58yrsUS$704.62k0.074%
$ 4.4m

15.1yrs

Average Tenure

57.5yo

Average Age

Experienced Board: CACC's board of directors are seasoned and experienced ( 15.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CACC insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Credit Acceptance Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Credit Acceptance Corporation
  • Ticker: CACC
  • Exchange: NasdaqGS
  • Founded: 1972
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: US$5.959b
  • Shares outstanding: 17.81m
  • Website: https://www.creditacceptance.com

Number of Employees


Location

  • Credit Acceptance Corporation
  • 25505 West Twelve Mile Road
  • Southfield
  • Michigan
  • 48034-8339
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CACCNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJun 1992
2D5DB (Deutsche Boerse AG)YesCommon StockDEEURJun 1992
CRDA34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REP 0.1 COM USD0.01BRBRLMay 2019

Biography

Credit Acceptance Corporation provides financing programs, and related products and services to independent and franchised automobile dealers in the United States. The company advances money to dealers in ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/26 23:58
End of Day Share Price2020/10/26 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.