Credit Acceptance Corp (CACC) received a Hold rating from Oppenheimer analyst Dominick Gabriele yesterday. The company’s shares closed yesterday at $414.37.
Gabriele commented:
“CACC’s rise of up over 26% in just over a year while the S&P500 Financials index declined 10.45% makes for ~36% outperformance. We still believe in the long-term business model and believe CACC is one the best subprime lenders in the business. That said, we think the P/E multiple tracks the YoY change in dealer penetration and YoY loan growth. We have seen these numbers fall from -2.5% to -5.6% and 9.4% to 5.9%, respectively, QoQ. Without a ramp in the workforce, we find it hard for these metrics to re-accelerate near term (Exhibit 1). We have also ridden an unbelievable wave of short covering (Exhibit 2), which is now back to historical levels.”
According to TipRanks.com, Gabriele is a 1-star analyst with an average return of -3.8% and a 30.4% success rate. Gabriele covers the Financial sector, focusing on stocks such as Discover Financial Services, Capital One Financial, and Synchrony Financial.
Currently, the analyst consensus on Credit Acceptance Corp is a Moderate Sell with an average price target of $347.25.
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Based on Credit Acceptance Corp’s latest earnings release for the quarter ending September 30, the company reported a quarterly revenue of $332 million and net profit of $151 million. In comparison, last year the company had a net profit of $177 million.
Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is negative on the stock.
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Credit Acceptance Corp. engages in the the provision of dealer financing programs that enables automobile dealers to sell vehicles to consumers, regardless of its credit history. Its financing programs are offered through a nationwide network of automobile dealers who benefit from sales of vehicles to consumers.
