Don't Buy Credit Acceptance Before Checking Its Fundamentals!

One of the losers of today's trading session was Credit Acceptance. Shares of the Diversified financial company plunged -17.1%, and some investors may be wondering if its price of $413.59 would make a good entry point. Here's what you should know if you are considering this investment:

  • Credit Acceptance has moved -19.8% over the last year, and the S&P 500 logged a change of -0.2%

  • CACC has an average analyst rating of hold and is -3.0% away from its mean target price of $426.4 per share

  • Its trailing earnings per share (EPS) is $40.05

  • Credit Acceptance has a trailing 12 month Price to Earnings (P/E) ratio of 10.3 while the S&P 500 average is 15.97

  • Its forward earnings per share (EPS) is $41.35 and its forward P/E ratio is 10.0

  • The company has a Price to Book (P/B) ratio of 3.1 in contrast to the S&P 500's average ratio of 2.95

  • Credit Acceptance is part of the Finance sector, which has an average P/E ratio of 14.34 and an average P/B of 1.57

  • CACC has reported YOY quarterly earnings growth of -49.1% and gross profit margins of 0.9%

  • Credit Acceptance Corporation engages in the provision of financing programs, and related products and services to independent and franchised automobile dealers in the United States. The company advances money to automobile dealers in exchange for the right to service the underlying consumer loans; and buys the consumer loans from the dealers and keeps the amount collected from the consumers. It is also involved in the business of reinsuring coverage under vehicle service contracts sold to consumers by dealers on vehicles financed by the company. The company was incorporated in 1972 and is headquartered in Southfield, Michigan.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.