Start here if you're new
what it is
Credit Acceptance helps car dealers finance buyers with bruised credit, then collects the loan payments and the risk.
how it gets paid
Last year Credit Acceptance made $2.3B in revenue. Portfolio program collections and finance income was the main engine at $1.15B, or 50% of sales.
why it's growing
Revenue grew 7.2% last year. Revenue reached $1.7B, up 198% vs. prior year, while full-year 2025 EPS recovered to $36.25 from $19.88 in 2024.
what just happened
The quarter worked because EPS landed at $10.99, above the $9.52 consensus estimate by 15.44%.
At a glance
B+ balance sheet — decent shape, but not bulletproof
45/100 earnings predictability — expect surprises
13.0x trailing p/e — the market's not buying it — or you found a deal
8.5% return on capital — nothing to write home about
xvary composite: 48/100 — below average
What they do
Credit Acceptance helps car dealers finance buyers with bruised credit, then collects the loan payments and the risk.
When your credit is messy and you still need a car to get to work, your options shrink fast. Credit Acceptance sits in that gap through two dealer programs and a nationwide network, while earning a 47.0% operating margin in the latest base data. Scale → more dealer relationships and loan history → so what: you get a lender that can price ugly risk faster than smaller rivals.
How they make money
$2.3B
annual revenue · their business grew +7.2% last year
Portfolio program collections and finance income
$1.15B
Purchase program loan income
$0.69B
Dealer partner fees and advances economics
$0.23B
Servicing, recoveries, and other related products
$0.23B
The products that matter
originates and services auto loans
Subprime Auto Loans
$2.3B · 100% of revenue
it is the entire $2.3B business. if you own CACC, you are not diversified across products — you are betting on one underwriting machine.
100% of revenue
Key numbers
13.0x
trailing p/e
P/E → price divided by profit → so what: you are paying 13 times trailing earnings for a lender expected to earn $44.00 in fiscal 2026.
$44.00
FY2026 EPS
EPS → profit per share → so what: at today's $472.03 price, that points to roughly 10.7 times fiscal 2026 earnings, below the 13.0x trailing multiple.
47.0%
operating margin
Operating margin → profit after running the business → so what: nearly half of revenue turns into operating profit, which is huge for a lender facing messy borrowers.
$6.2B
long-term debt
Debt → money the company owes → so what: the balance sheet carries $6.2B of long-term debt, equal to 54% of capital, so funding discipline matters more than hype.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 45 / 100
- long-term debt $6.2B (54% of capital)
- net profit margin 15.8% — keeps 16 cents of every dollar in revenue
- return on equity 13% — $0.13 profit for every $1 investors have put in
B+ — net profit margin looks solid but long-term debt needs watching.
Total return vs. market
You invested $10,000 in CACC 3 years ago → it's now worth $11,490.
The index would have given you $14,770.
source: institutional data · total return
What just happened
beat estimates
The quarter worked because EPS landed at $10.99, above the $9.52 consensus estimate by 15.44%.
Revenue reached $1.7B, up 198% vs. prior year, while full-year 2025 EPS recovered to $36.25 from $19.88 in 2024. That is what credit performance stabilization looks like in numbers.
$1.7B
revenue
$10.99
eps
47.0%
gross margin
the number that mattered
The number that mattered was $10.99 EPS because it showed earnings power stayed far above the prior-year run rate even after a volatile 2024.
-
credit acceptance has appointed a new ceo.
-
kenneth booth is scheduled to retire as chief executive officer and president on january 31st, while continuing to serve on the board.
-
vinayak hedge, a former board member had stepped into the position to replace mr.
-
booth earlier than expected on november 13, 2025.
-
mr.hedge has already been a board member at the company for the past four years and previously held the role of chief marketing officer at t-mobile, where he led the digital transformation of the consumer business. his background aligns with credit acceptance’s system-modernization efforts, likely making for a smooth leadership transition.
source: company earnings report, 2026
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What could go wrong
the #1 risk is subprime auto credit losses outrunning pricing and collections.
med
credit losses spike
All $2.3B of revenue comes from one lending niche. If unemployment rises or used-car recoveries weaken, losses hit the core business, not a side segment.
The buffer is the current 19.5% net margin. If that compresses, the low multiple stops looking cheap.
med
leverage raises the stakes
CACC carries $6.2B of long-term debt, equal to 54% of capital. That is manageable when collections are healthy and much less comfortable when they are not.
You are underwriting the asset quality and the funding structure at the same time.
med
regulatory pressure is hard to model
Subprime auto finance gets more attention than plain-vanilla lending. The page data does not quantify direct exposure here, so we will not fake precision.
The practical risk is slower originations, higher compliance costs, or tougher collection rules in a business already priced for caution.
100% of revenue comes from subprime auto lending and the balance sheet carries $6.2B of long-term debt. That is a focused model with very little room for a bad credit turn.
source: institutional data · regulatory filings · risk analysis
Pay attention to
margin
net margin holding near 19.5%
This is the first line of defense. If profitability slips, the cheap multiple has less cover.
earnings
the next quarterly print
You want to see whether the $11.85 EPS setup lands and whether management says credit performance is stable.
balance sheet
long-term debt versus operating performance
$6.2B of long-term debt is fine until returns weaken. Watch leverage and profits together, not in isolation.
flow
institutional selling reversing
101 buyers versus 145 sellers in 3q2025 is a soft tape. A turn here would tell you confidence is improving.
Analyst rankings
short-term outlook
below average
momentum score 4 — in human-speak, analysts expect the stock to lag unless the credit picture improves.
risk profile
average
stability score 3 — this is not a bunker stock, but it is not pure chaos either.
chart momentum
below average
technical score 4 — the tape is not helping you right now.
earnings predictability
45 / 100
earnings are harder to predict here because credit results move faster than most models do.
source: institutional data
Institutional activity
101 buyers vs. 145 sellers in 3q2025. total institutional holdings: 7.6M shares.
source: institutional data
Price targets
3-5 year target range
$387
$799
$472
current price
$593
target midpoint · +26% from current · 3-5yr high: $805 (+70% · 14% ann'l return)
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