Credit Acceptance (CACC) AI Stock Analysis

• Market Cap: $5.50B
• Dividend Yield: N/A
• Average Volume (3M): 132.55K
• Price to Earnings (P/E): 13.6
• Beta (1Y): 1.21
• Revenue Growth: 10.30%
• EPS Growth: 154.64%
• Country: US
• Employees: 2,431
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 11.35
• Shares Outstanding: 11,031,544
• 10 Day Avg. Volume: 124,218
• 30 Day Avg. Volume: 132,546
• PEG Ratio: -2.62
• Price to Book (P/B): 3.31
• Price to Sales (P/S): 2.71
• P/FCF Ratio: 5.09
• Enterprise Value/Market Cap: 2.06
• Enterprise Value/Revenue: 5.00
• Enterprise Value/Gross Profit: 8.08
• Enterprise Value/Ebitda: 18.99
• 1Y Price Target: $470.00
• Price Target Upside: -5.67% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: $556.00 ▲(11.59% Upside)

The score is driven primarily by strong cash generation and improved recent profitability, supported by a technically constructive uptrend and a reasonable P/E. The main constraints are credit-cycle risk signals (historically high leverage and mixed/declining origination KPIs and market share discussed on the call), plus some data consistency concerns around reported TTM debt versus prior years.

Positive Factors

Strong free cash flow generation

Consistent FCF above $1B and cash closely tracking net income provides durable internal funding for originations, ABS support, servicing, and shareholder returns. This cash generation cushions credit cycles and sustains capital allocation over the next several quarters.

Improved funding flexibility and lower cost of capital

Extension and repricing of term ABS materially lowers funding costs and extends revolver life, structurally improving liquidity and the economics of originating and securitizing subprime auto loans. This reduces refinancing pressure and supports origination capacity into 2028.

Product and technology investments

Integration with RouteOne and AI investments modernize origination and servicing, improving dealer workflow, underwriting consistency, and collection efficiency. These structural improvements can raise win-rates and operating leverage over multiple quarters.

Negative Factors

Historically elevated leverage and reporting inconsistency

High leverage in a credit-sensitive lending model increases vulnerability to underwriting shocks and constrains capital flexibility. The sharp TTM debt reporting discrepancy raises transparency concerns and complicates assessment of true financial flexibility over the medium term.

Eroding market share and declining originations

Sustained declines in market share, active dealers and per-dealer volumes signal structural pressure on origination scale and dealer relationships. Lower new originations shrink fee and interest revenue potential and may require sustained investment to regain footing.

Senior analytics and sales leadership retirements

Departure of senior analytics and sales officers risks disruption to underwriting refinement and dealer coverage during a delicate originations recovery. Consulting arrangements provide short-term continuity, but leadership transitions could impede execution on product fixes and market-share remediation.

Credit Acceptance Business Overview & Revenue Model

Company Description

Credit Acceptance Corporation provides financing programs, and related products and services to independent and franchised automobile dealers in the United States. The company advances money to dealers in exchange for the right to service the underlying consumer loans; and buys the consumer loans from the dealers and keeps various amounts 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 founded in 1972 and is headquartered in Southfield, Michigan.

How the Company Makes Money

Credit Acceptance generates revenue primarily through the interest earned on the loans it provides to consumers. The company purchases retail installment contracts from dealerships, which include the principal amount financed plus interest. This interest is a significant source of income, as the company typically charges higher rates to subprime borrowers. Additionally, Credit Acceptance earns revenue from fees associated with the loan servicing and collection processes. The company also benefits from partnerships with a network of automobile dealerships, which help expand its customer base and increase loan origination volume. The ability to sell loans to investors in the secondary market further enhances its revenue potential, as it can recycle capital and fund new loans.

Credit Acceptance Financial Statement Overview

Summary

Strong cash generation (FCF closely tracking net income and >$1B in 2024 and TTM) and improved TTM profitability support the score. Offsetting factors include high leverage in prior years, a sharp TTM debt discrepancy versus historical levels, and multi-year margin volatility that adds financial-risk and comparability concerns.

Income Statement

TTM (Trailing-Twelve-Months) revenue is up strongly versus the prior annual period, and profitability has improved meaningfully (net margin ~20% TTM vs ~12% in 2024). However, longer-term results show notable volatility: 2021–2022 margins were exceptionally high and have since normalized, and 2020 shows an inconsistency (EBIT reported as 0 while EBITDA is positive), which reduces confidence in clean trend assessment. Overall, solid recent profitability and growth, but with a less stable multi-year earnings profile.

Balance Sheet

The annual balance sheet (2020–2024) shows consistently high leverage, with debt running roughly ~2.0x to ~3.6x equity, which elevates financial risk in a credit-sensitive business. Returns on equity are strong across the period (mid-teens to very high levels), indicating good earnings power on the capital base. The TTM (Trailing-Twelve-Months) snapshot shows zero total debt and a zero debt-to-equity ratio, which is a sharp break from the prior years and suggests either a reporting/classification difference or a major balance sheet change; that discrepancy tempers the score despite otherwise strong equity profitability.

Cash Flow

Cash generation is a clear strength: free cash flow closely tracks net income across periods (near 1:1), suggesting earnings are well supported by cash. Operating cash flow is consistently robust, and free cash flow remains over $1.0B in both 2024 and TTM (Trailing-Twelve-Months). The main drawback is growth: free cash flow growth is negative in recent periods (slightly down in 2023 and 2024, and down more in TTM), indicating cash flow is strong but not currently expanding.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.27B	2.13B	1.88B	1.82B	1.85B	1.67B
Gross Profit	1.40B	1.33B	1.26B	1.35B	1.43B	1.25B
EBITDA	597.70M	352.90M	373.90M	727.90M	1.28B	576.60M
Net Income	453.80M	247.90M	286.10M	535.80M	958.30M	421.00M
Balance Sheet
Total Assets	8.64B	9.74B	8.39B	7.63B	7.05B	7.49B
Cash, Cash Equivalents and Short-Term Investments	15.90M	854.50M	477.80M	421.70M	23.30M	16.00M
Total Debt	6.37B	6.35B	5.07B	4.59B	4.62B	4.70B
Total Liabilities	7.06B	7.99B	6.64B	6.01B	5.23B	5.19B
Stockholders Equity	1.58B	1.75B	1.75B	1.62B	1.82B	2.30B
Cash Flow
Free Cash Flow	1.09B	1.14B	1.20B	1.24B	1.06B	976.70M
Operating Cash Flow	1.09B	1.14B	1.20B	1.24B	1.07B	985.20M
Investing Cash Flow	-800.60M	-1.72B	-1.42B	-460.60M	437.30M	-673.50M
Financing Cash Flow	-508.40M	957.30M	266.20M	-794.60M	-1.47B	-433.20M

Credit Acceptance Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 498.24
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CACC, the sentiment is Positive. The current price of 498.24 is above the 20-day moving average (MA) of 458.89, above the 50-day MA of 456.43, and above the 200-day MA of 481.53, indicating a bullish trend. The MACD of -0.23 indicates Negative momentum. The RSI at 64.79 is Neutral, neither overbought nor oversold. The STOCH value of 46.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CACC.

Credit Acceptance Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OMF	79 Outperform	$7.72B	11.22	21.41%	6.07%	9.51%	29.38%
CACC	73 Outperform	$5.50B	13.65	28.14%	―	10.30%	154.64%
AGM	70 Outperform	$1.81B	9.74	13.72%	3.40%	27.36%	12.55%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
LC	63 Neutral	$2.26B	14.23	9.55%	―	9.68%	94.85%
SLM	62 Neutral	$5.51B	7.78	32.31%	1.88%	0.59%	-1.11%
NAVI	47 Neutral	$956.54M	-11.98	-1.95%	4.95%	-25.22%	-174.34%

Credit Acceptance Corporate Events

Credit Acceptance Announces Retirement of Two Senior Officers

On January 20, 2026, Credit Acceptance Corporation announced that Chief Analytics Officer Arthur L. Smith and Chief Sales Officer Daniel A. Ulatowski had notified the company of their decisions to retire as officers and employees, effective February 1, 2026, and that both executives were expected to continue in consulting roles as non-employee advisors through July 31, 2026. Under anticipated separation and advisory agreements, Smith is expected to receive a monthly consulting fee of $66,758.01 and Ulatowski $64,166.67 during the advisory period, and in each case their retirements will be treated as qualifying retirements under the company’s incentive compensation plan, allowing their outstanding stock options to remain exercisable through their scheduled expiration date of December 30, 2026, which provides continuity in leadership transition and preserves equity incentives alignment during the handover period.

The most recent analyst rating on (CACC) stock is a Buy with a $522.00 price target. To see the full list of analyst forecasts on Credit Acceptance stock, see the CACC Stock Forecast page.

Credit Acceptance Extends and Reprices Term ABS Financing

On January 15, 2026, Credit Acceptance Corporation announced it had amended its existing $100 million asset-backed non-recourse secured financing, known as Term ABS 2021-1, originally entered into on January 29, 2021. The amendment extends the date on which the facility will cease to revolve from February 17, 2026 to January 18, 2028 and reduces the interest rate from SOFR plus 220 basis points to SOFR plus 140 basis points, with no other material changes to the terms. The extension and lower pricing enhance the company’s funding flexibility and reduce its cost of capital, supporting ongoing auto loan origination and reinforcing its position in the asset-backed financing market.

The most recent analyst rating on (CACC) stock is a Hold with a $513.00 price target. To see the full list of analyst forecasts on Credit Acceptance stock, see the CACC Stock Forecast page.

Credit Acceptance Completes $500M Asset-Backed Financing

On November 13, 2025, Credit Acceptance Corporation announced the completion of a $500 million asset-backed non-recourse secured financing. This transaction involved conveying consumer loans valued at approximately $625.2 million to a special purpose entity, which then transferred the loans to a trust that issued three classes of notes. The financing, which has an expected average annualized cost of 5.1%, will revolve for 24 months before amortizing based on loan cash flows. It aims to repay higher-cost debt and support general corporate purposes, while maintaining dealer relationships and preserving their rights to future payments. This marks Credit Acceptance’s 60th term securitization since 1998 and is noted as their lowest-cost ABS transaction since late 2021.

The most recent analyst rating on (CACC) stock is a Hold with a $475.00 price target. To see the full list of analyst forecasts on Credit Acceptance stock, see the CACC Stock Forecast page.