Credit Acceptance (NASDAQ:CACC) Posts Quarterly Earnings Results, Misses Expectations By $0.08 EPS

Credit Acceptance (NASDAQ:CACC) announced its earnings results on Tuesday. The credit services provider reported $12.12 earnings per share (EPS) for the quarter, missing the consensus estimate of $12.20 by ($0.08), FiscalAI reports. The business had revenue of $415.00 million for the quarter, compared to analysts’ expectations of $588.07 million. Credit Acceptance had a net margin of 19.49% and a return on equity of 29.95%.

Credit Acceptance Price Performance

Shares of CACC traded up $14.88 during midday trading on Tuesday, hitting $587.85. 118,406 shares of the company traded hands, compared to its average volume of 182,850. The stock has a 50-day moving average of $591.94 and a 200-day moving average of $523.95. Credit Acceptance has a one year low of $401.90 and a one year high of $668.86. The firm has a market cap of $6.15 billion, a P/E ratio of 14.61 and a beta of 1.37. The company has a debt-to-equity ratio of 4.09, a current ratio of 13.62 and a quick ratio of 13.62.

Wall Street Analyst Weigh In

A number of analysts recently issued reports on the stock. Weiss Ratings upgraded shares of Credit Acceptance from a “hold (c+)” rating to a “buy (b-)” rating in a report on Thursday, July 16th. Stephens boosted their price objective on Credit Acceptance from $450.00 to $540.00 and gave the company an “equal weight” rating in a research note on Friday, April 17th. TD Cowen upped their price objective on shares of Credit Acceptance from $500.00 to $575.00 and gave the company a “hold” rating in a report on Tuesday, July 7th. Finally, Zacks Research lowered shares of Credit Acceptance from a “strong-buy” rating to a “hold” rating in a research report on Wednesday, May 13th. One research analyst has rated the stock with a Buy rating and three have assigned a Hold rating to the company. According to MarketBeat, the stock presently has an average rating of “Hold” and a consensus price target of $557.50.

Insider Transactions at Credit Acceptance

In related news, CFO Jay D. Martin sold 3,000 shares of the company’s stock in a transaction that occurred on Wednesday, June 24th. The shares were sold at an average price of $601.04, for a total transaction of $1,803,120.00. Following the sale, the chief financial officer owned 25,963 shares of the company’s stock, valued at approximately $15,604,801.52. This represents a 10.36% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, major shareholder Jill Foss Watson sold 11,000 shares of the firm’s stock in a transaction on Thursday, July 2nd. The shares were sold at an average price of $653.24, for a total transaction of $7,185,640.00. Following the completion of the transaction, the insider directly owned 49,346 shares of the company’s stock, valued at approximately $32,234,781.04. The trade was a 18.23% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last 90 days, insiders sold 47,304 shares of company stock valued at $29,186,331. Company insiders own 6.10% of the company’s stock.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Creative Planning boosted its stake in shares of Credit Acceptance by 8.1% in the 3rd quarter. Creative Planning now owns 572 shares of the credit services provider’s stock valued at $267,000 after purchasing an additional 43 shares in the last quarter. Mackenzie Financial Corp grew its holdings in shares of Credit Acceptance by 14.1% during the 3rd quarter. Mackenzie Financial Corp now owns 721 shares of the credit services provider’s stock valued at $337,000 after purchasing an additional 89 shares during the last quarter. Russell Investments Group Ltd. raised its position in Credit Acceptance by 5.3% in the 3rd quarter. Russell Investments Group Ltd. now owns 721 shares of the credit services provider’s stock worth $337,000 after purchasing an additional 36 shares during the period. Two Sigma Securities LLC lifted its stake in Credit Acceptance by 12.7% in the second quarter. Two Sigma Securities LLC now owns 779 shares of the credit services provider’s stock worth $397,000 after purchasing an additional 88 shares during the last quarter. Finally, Sei Investments Co. lifted its stake in Credit Acceptance by 42.7% in the second quarter. Sei Investments Co. now owns 819 shares of the credit services provider’s stock worth $417,000 after purchasing an additional 245 shares during the last quarter. 81.71% of the stock is currently owned by hedge funds and other institutional investors.

Credit Acceptance Company Profile

Credit Acceptance Corporation, founded in 1972 and headquartered in Southfield, Michigan, is a specialty finance company focused on the indirect automotive lending market. The company partners with independent and franchised auto dealers to facilitate purchase financing for consumers who may not qualify for traditional prime auto loans. By purchasing retail installment contracts originated by these dealers, Credit Acceptance provides capital and credit insurance to support vehicle sales, enabling dealers to broaden their customer base and reduce credit risk.

Through its proprietary underwriting platform and risk management strategies, Credit Acceptance evaluates borrower applications, structures credit plans, and retains servicing rights on the acquired contracts.