Credit Acceptance Corp

Credit Acceptance Corp maintains a capital structure characterized by zero reported debt-to-equity in the valuation snapshot, yet the balance sheet reveals total liabilities of $7.18 billion against total equity of $1.51 billion. The company holds $25.7 million in cash and equivalents, generating $346.8 million in operating cash flow and $345.5 million in free cash flow for Q1 2026. Liquidity risk is assessed as low, supported by strong cash generation, although the company relies on a complex web of secured financing facilities, including revolving credit lines and term ABS structures, with maturities extending through 2030. The diluted share count of 10.95 million is moderately above the basic count of 10.42 million, indicating existing dilution pressure.

Profitability metrics show a return on equity of 28% and a return on assets of 4.88%. The company trades at a price-to-earnings ratio of 14.5 and a price-to-book ratio of 4.06. Net income for Q1 2026 was $135.8 million on revenue of $580 million, implying a net margin of approximately 23.4%. While cohort medians are not provided for direct comparison, the high ROE suggests efficient use of equity capital, typical for specialized finance entities. The valuation multiple of 14.5x earnings is moderate, reflecting the niche nature of the business.

The company operates in a single reportable segment focused on innovative financing solutions for automobile dealers. Geographic exposure is not explicitly detailed in the provided data, but the business model is inherently tied to the US automotive market. Revenue concentration is high within this single segment, which offers financing to consumers with FICO scores below 650 or no scores, comprising 79.5% of total unit volume in 2025. This concentration in subprime lending creates specific credit risk exposures.

Growth trajectory data is limited to the Q1 2026 snapshot, with revenue of $580 million. Historical annual revenue trends are not provided in the input data. The company’s ability to grow depends on vehicle sales volumes and the penetration of its financing solutions among dealers. The consistent volume of subprime loan assignments (79.5% in 2025 vs 80.6% in 2024) indicates a stable customer base profile.

Risk assessment highlights high dilution risk, with key flags noting that the diluted share count is moderately above the basic count and source documents mention dilution or offering risk. Liquidity risk is low, but the company faces regulatory scrutiny, as evidenced by a civil investigative demand from the Bureau in 2019 regarding origination and collection practices. The company also faces credit risk inherent in its subprime lending portfolio, though specific loss rates are not provided.

Recent events include the filing of an 8-K with material item 5.02, indicating a significant corporate event or agreement. Analyst estimates show a mean price target of $591.67 and a median of $575.00, with a mean recommendation of 3.00 (Hold). There are no strong buy or buy ratings, with three hold ratings, suggesting a neutral market sentiment. The company’s financing facilities include various warehouse and term ABS structures with interest rates tied to SOFR or fixed rates, maturing between 2024 and 2030.

Credit Acceptance Corp (CACC) has entered the scope of this analysis, marking the first available data point for the ticker with no prior basis for computing material changes. This initial snapshot establishes the baseline for monitoring the company’s financial trajectory and investor sentiment moving forward. The most significant recent development involves a major reduction in holdings by investor ID 587. As of March 31, 2026, this investor trimmed their position from 947 shares to just 29 shares, a change detected on July 15, 2026. This substantial decrease in share count represents a notable shift in ownership structure for this specific holder. Conversely, several other investors initiated new positions in CACC during the same period. Notable additions include investor ID 465, who held 395,474 shares as of December 31, 2025, and investor ID 481, who held 90,915 shares as of March 31, 2026. Other new holders reported as of March 31, 2026, include investor ID 486 with 76,424 shares, investor ID 467 with 94,262 shares, and investor ID 478 with 4,286 shares. These ownership changes occur within a broader context where CACC is tracked by seven analysts and has 30 top holders, though it currently holds no index memberships. The company’s profile includes one officer, and the recent influx of new holders alongside the exit of investor ID 587 highlights active rebalancing among institutional participants.

The company maintains a zero debt-to-equity ratio, contrasting sharply with the 1.18 median leverage in its peer group.

Analysts project 5.4% upside to a mean price target of $591.67, suggesting modest valuation appreciation potential.

Total assets grew 7.9% annually over five years, indicating consistent balance sheet expansion despite recent revenue volatility.

The company faces high dilution risk, which could erode shareholder value and reduce earnings per share over time.

Revenue declined 6.7% year-over-year in FY2025, reflecting weakening top-line growth momentum in the current period.

A two-year net income CAGR of -6.9% indicates a sustained downward trend in profitability over the recent period.

The stock trades at 4.06x tangible book value, implying a premium valuation that may be vulnerable to margin compression.

Revenue $580.0M; Net margin 23.4%.

• ▍Revenue $580.0M
• ▍Net margin 23.4%

Revenue $1.74B; Net margin 17.4%.

• ▍Revenue $1.74B
• ▍Net margin 17.4%

Revenue $1.15B; Net margin 16.8%.

• ▍Revenue $1.15B
• ▍Net margin 16.8%

Revenue $2.32B; Net margin 18.3%.

• ▍Revenue $2.32B
• ▍Net margin 18.3%

Revenue $2.16B; Net margin 11.5%.

• ▍Revenue $2.16B
• ▍Net margin 11.5%

Revenue $2.16B; Net margin 11.5%.

• ▍Revenue $2.16B
• ▍Net margin 11.5%

Revenue $1.90B; Net margin 15.0%.

• ▍Revenue $1.90B
• ▍Net margin 15.0%

Revenue $1.90B; Net margin 15.0%.

• ▍Revenue $1.90B
• ▍Net margin 15.0%