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Credit Acceptance
(NASDAQ:CACC)
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Rating:73Outperform
Price Target:
$629.00
▲(4.09% Upside)
Action:Reiterated
Date:09/22/26
The score is driven mainly by strong financial performance (notably cash generation and solid profitability) and a constructive earnings update showing improving origination momentum. Valuation is supportive with a moderate P/E. Offsetting factors include weaker technical positioning (below key short/intermediate moving averages) and event risk from the regulatory settlement despite improved funding flexibility.
Positive Factors
Strong cash generation
Consistently strong operating and free cash flow indicates that reported profitability is supported by cash, not merely accounting gains. This provides capacity to fund receivables, service obligations, invest in underwriting capabilities, and maintain financial flexibility through the next several quarters.
Negative Factors
Regulatory obligations
The settlement creates lasting compliance and operating obligations, including tighter collection protocols, expanded disclosures, affordability protections, and dealer oversight. Even with costs covered by existing accruals, these changes may increase execution complexity and constrain practices across the lending platform.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistently strong operating and free cash flow indicates that reported profitability is supported by cash, not merely accounting gains. This provides capacity to fund receivables, service obligations, invest in underwriting capabilities, and maintain financial flexibility through the next several quarters.
Read all positive factors
Credit Acceptance Key Performance Indicators (KPIs)
Credit Acceptance (CACC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.68B
Dividend YieldN/A
Average Volume (3M)113.18K
Price to Earnings (P/E)11.8
Beta (1Y)1.40
Revenue Growth2.58%
EPS Growth32.02%
CountryUS
Employees2,314
SectorFinancial
Sector Strength70
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)46.41
Shares Outstanding10,380,580
10 Day Avg. Volume105,940
30 Day Avg. Volume113,178
Financial Highlights & Ratios
PEG Ratio0.13
Price to Book (P/B)3.22
Price to Sales (P/S)2.12
P/FCF Ratio4.67
Enterprise Value/Market Cap2.22
Enterprise Value/Revenue5.43
Enterprise Value/Gross Profit6.06
Enterprise Value/Ebitda12.65
Forecast
1Y Price Target
$590.00Price Target Upside-2.36% Downside
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)48.63
Revenue Forecast (FY)$2.37B
Credit Acceptance Business Overview & Revenue Model
Company Description
Credit Acceptance Corporation engages in the provision of financing programs, and related products and services in the United States. It advances money to automobile dealers in exchange for the right to service the underlying consumer loans; and b...
How the Company Makes Money
CACC primarily makes money by providing financing in connection with retail installment contracts originated at automobile dealers and then collecting and servicing the resulting loan cash flows. In its indirect model, a dealer originates the reta...
Credit Acceptance Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 02, 2026
Earnings Call Sentiment Positive
The call conveyed materially positive near-term financial results—strong GAAP and adjusted earnings growth, improving origination trends (monthly unit growth in June/July), record active dealer counts, modest loan-dollar growth, and strengthened liquidity—while acknowledging persistent but moderating credit and timing headwinds. Management emphasized disciplined, data-driven improvements (pricing, segmentation, AI tooling) and called the transformation early but showing tangible results. Key risks highlighted include slower-than-expected prepayments (continuing to pressure provisions), modest underperformance in the 2025 vintage, and unit/per-dealer activity still below peak. On balance, the positive operational momentum and significant earnings improvement outweigh the measured portfolio challenges.Positive Updates
Strong Earnings Growth
GAAP net income of $135.9M or $12.66 per diluted share, up 71% year-over-year. Adjusted net income of $130.1M or $12.12 per diluted share, up 21% year-over-year; improvement driven by decreased provision for credit losses and a nonrecurring $23M contingent loss in prior year.
Negative Updates
Forecasted Cash Flow Revision and Provision Headwinds
Undiscounted forecasted cash flows declined $39.1M (0.3%) in the quarter. The provision forecast change was cited as $82M, with a continuing headwind from slower-than-expected prepayments, which have been impacting provisions for multiple quarters.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Earnings Growth
GAAP net income of $135.9M or $12.66 per diluted share, up 71% year-over-year. Adjusted net income of $130.1M or $12.12 per diluted share, up 21% year-over-year; improvement driven by decreased provision for credit losses and a nonrecurring $23M contingent loss in prior year.
Read all positive updates
Company Guidance
Management's guidance was cautiously optimistic and data‑driven: Q2 GAAP net income was $135.9M ($12.66/sh, +71% Y/Y) with adjusted net income $130.1M ($12.12/sh, +21% Y/Y); forecasted loan portfolio net cash flows declined $39.1M (0.3%) on roughly $12B of projected cash flows (vs a $55.8M, 0.5% decline a year ago) and provision forecast changes totaled ~$82M, driven mainly by slower‑than‑expected prepayments; origination unit volume was down 1% in Q2 (improving from –4.3% in Q1) while loan dollar volume was +0.1% (vs –4% in Q1), monthly unit volumes turned positive in June and July (July >+20% YoY, roughly back to 2024 levels), average units per active dealer were down 3.8% YoY, the company financed >84,000 contracts, added >1,400 new dealers and had >11,000 active dealers (record), collected >$1.4B and paid $43.5M in dealer holdback, maintained ≈$1.4B available on revolvers, reported the 2022 vintage as stable and the 2025 vintage within 10 bps of forecast, and expects advance rates to remain in historical ranges (around 46.1%) while prioritizing disciplined, profitable growth through segmentation and AI‑enabled decisioning.Credit Acceptance Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
66
Positive
Cash Flow
85
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.32B | 2.32B | 2.13B | 1.88B | 1.82B | 1.85B |
| Gross Profit | 2.08B | 2.29B | 1.33B | 1.26B | 1.35B | 1.43B |
| EBITDA | 997.30M | 1.05B | 352.90M | 373.90M | 727.90M | 1.28B |
| Net Income | 501.90M | 423.90M | 247.90M | 286.10M | 535.80M | 958.30M |
Balance Sheet | ||||||
| Total Assets | 8.62B | 9.60B | 9.74B | 8.39B | 7.63B | 7.05B |
| Cash, Cash Equivalents and Short-Term Investments | 1.40M | 510.30M | 854.50M | 477.80M | 421.70M | 23.30M |
| Total Debt | 6.29B | 6.35B | 6.35B | 5.07B | 4.59B | 4.62B |
| Total Liabilities | 7.03B | 8.07B | 7.99B | 6.64B | 6.01B | 5.23B |
| Stockholders Equity | 1.59B | 1.52B | 1.75B | 1.75B | 1.62B | 1.82B |
Cash Flow | ||||||
| Free Cash Flow | 1.22B | 1.05B | 1.14B | 1.20B | 1.24B | 1.06B |
| Operating Cash Flow | 1.23B | 1.05B | 1.14B | 1.20B | 1.24B | 1.07B |
| Investing Cash Flow | -552.00M | -674.30M | -1.72B | -1.42B | -460.60M | 437.30M |
| Financing Cash Flow | -744.70M | -724.60M | 957.30M | 266.20M | -794.60M | -1.47B |
Credit Acceptance Technical Analysis
Neutral
604.26
Price Trends
576.35
Negative
582.34
Negative
531.84
Positive
Market Momentum
-14.02
Negative
44.78
Neutral
68.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CACC, the sentiment is Neutral. The current price of 604.26 is above the 20-day moving average (MA) of 555.45, above the 50-day MA of 576.35, and above the 200-day MA of 531.84, indicating a neutral trend. The MACD of -14.02 indicates Negative momentum. The RSI at 44.78 is Neutral, neither overbought nor oversold. The STOCH value of 68.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CACC.
Credit Acceptance Risk Analysis
Credit Acceptance disclosed 31 risk factors in its most recent earnings report. Credit Acceptance reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Credit Acceptance Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $5.68B | 11.80 | 32.35% | ― | 2.58% | 32.02% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
67 Neutral | $6.45B | 8.42 | 23.07% | 7.49% | 6.93% | 19.96% | |
64 Neutral | $4.43B | 12.46 | 25.76% | ― | 17.65% | 43.92% | |
60 Neutral | $1.21B | 8.31 | 19.36% | 1.80% | 4.52% | -29.04% | |
55 Neutral | $2.35B | 38.78 | 7.85% | ― | 46.30% | ― |
* Financial Sector Average
CACC
Credit Acceptance
548.12
59.98
12.29%
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30.52
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23.75
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Credit Acceptance Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Credit Acceptance Extends Key Secured Funding Facilities
Positive
Sep 21, 2026
On September 15, 2026, Credit Acceptance extended the revolving period of its $500 million secured warehouse facility with Wells Fargo and Computershare from September 20, 2027 to September 15, 2028, while trimming the interest margin from SOFR pl...
Business Operations and StrategyLegal ProceedingsRegulatory Filings and Compliance
Credit Acceptance Settles Multistate Regulatory Case, Updates Practices
Negative
Sep 18, 2026
On September 17, 2026, Credit Acceptance Corporation reached consent judgments with the New York Attorney General and attorneys general from 40 states plus the District of Columbia, resolving a lawsuit filed in January 2023 and a multistate invest...
Business Operations and StrategyExecutive/Board Changes
Credit Acceptance Finalizes Separation Agreement With Former CFO
Neutral
Sep 4, 2026
On September 3, 2026, Credit Acceptance Corporation signed a separation agreement with former Chief Financial Officer Jay D. Martin, who had transitioned to an employee advisor role after his CFO tenure ended on July 27, 2026. Under the agreement,...
Business Operations and StrategyPrivate Placements and Financing
Credit Acceptance Expands Liquidity with New ABS Financing
Positive
Aug 25, 2026
On August 20, 2026, Credit Acceptance completed a $600 million asset-backed, non-recourse secured financing backed by approximately $750.2 million of consumer auto loans, issued in three note classes with an expected average annualized cost of abo...
Business Operations and StrategyExecutive/Board Changes
Credit Acceptance announces planned CTO leadership transition
Neutral
Jul 24, 2026
On July 20, 2026, Credit Acceptance Corporation announced that its Board of Directors and Chief Technology Officer Ravi Mohan mutually agreed that he would resign from his CTO role effective August 14, 2026, and fully separate from the company on ...
Business Operations and StrategyExecutive/Board Changes
Credit Acceptance Announces Board Resignation and Size Reduction
Neutral
Jul 22, 2026
On July 21, 2026, Credit Acceptance Corporation announced that director Kenneth S. Booth resigned from its board, with the company stating his departure was not due to any disagreement with management or fellow directors. The board expressed appre...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.