Credit Acceptance (NASDAQ:CACC) Stock Passes Above Two Hundred Day Moving Average - Here's What Happened

Key Points

• Credit Acceptance shares rose above their 200-day moving average on Tuesday, trading as high as $631.44 before last changing hands at $617.78. The 200-day average was $510.94.
• Analysts remain cautious overall, with four firms rating the stock a Hold and MarketBeat showing an average price target of $557.50. Recent moves included downgrades from Zacks Research and mixed target-price increases from TD Cowen and Stephens.
• Insider selling has been notable over the past 90 days, including sales by major shareholder Jill Foss Watson and COO Jonathan Lum. Insiders have sold 70,816 shares worth about $41.7 million in total.

Credit Acceptance Corporation (NASDAQ:CACC - Get Free Report)'s share price crossed above its 200-day moving average during trading on Tuesday . The stock has a 200-day moving average of $510.94 and traded as high as $631.44. Credit Acceptance shares last traded at $617.78, with a volume of 134,322 shares.

Wall Street Analyst Weigh In

CACC has been the subject of several analyst reports. Zacks Research cut shares of Credit Acceptance from a "strong-buy" rating to a "hold" rating in a research note on Wednesday, May 13th. TD Cowen lifted their price objective on shares of Credit Acceptance from $500.00 to $575.00 and gave the company a "hold" rating in a research report on Tuesday, July 7th. Weiss Ratings upgraded shares of Credit Acceptance from a "hold (c)" rating to a "hold (c+)" rating in a research note on Friday, May 8th. Finally, Stephens upped their target price on shares of Credit Acceptance from $450.00 to $540.00 and gave the company an "equal weight" rating in a report on Friday, April 17th. Four analysts have rated the stock with a Hold rating, According to MarketBeat, Credit Acceptance currently has an average rating of "Hold" and an average price target of $557.50.

Credit Acceptance Stock Performance

The stock has a market capitalization of $6.46 billion, a price-to-earnings ratio of 15.35 and a beta of 1.36. The company has a quick ratio of 13.62, a current ratio of 13.62 and a debt-to-equity ratio of 4.09. The company's fifty day simple moving average is $577.87 and its 200 day simple moving average is $510.94.

Credit Acceptance (NASDAQ:CACC - Get Free Report) last issued its quarterly earnings data on Tuesday, May 5th. The credit services provider reported $10.71 earnings per share (EPS) for the quarter, missing the consensus estimate of $10.73 by ($0.02). The company had revenue of $406.00 million for the quarter, compared to analyst estimates of $580.77 million. Credit Acceptance had a return on equity of 29.95% and a net margin of 19.49%.The company's revenue was up 1.6% on a year-over-year basis. During the same quarter last year, the business earned $9.35 earnings per share. On average, equities research analysts expect that Credit Acceptance Corporation will post 47.5 earnings per share for the current year.

Insider Activity at Credit Acceptance

In related news, major shareholder Jill Foss Watson sold 11,000 shares of the firm's stock in a transaction dated Thursday, July 2nd. The shares were sold at an average price of $653.24, for a total transaction of $7,185,640.00. Following the transaction, the insider directly owned 49,346 shares of the company's stock, valued at approximately $32,234,781.04. This trade represents a 18.23% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, COO Jonathan Lum sold 6,000 shares of the firm's stock in a transaction dated Wednesday, June 24th. The stock was sold at an average price of $600.00, for a total transaction of $3,600,000.00. Following the transaction, the chief operating officer directly owned 31,609 shares in the company, valued at approximately $18,965,400. This represents a 15.95% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last ninety days, insiders have sold 70,816 shares of company stock valued at $41,728,507. 6.10% of the stock is currently owned by insiders.

Institutional Trading of Credit Acceptance

A number of institutional investors have recently bought and sold shares of the business. Royal Bank of Canada increased its holdings in shares of Credit Acceptance by 31.6% during the first quarter. Royal Bank of Canada now owns 1,916 shares of the credit services provider's stock worth $989,000 after purchasing an additional 460 shares during the period. AQR Capital Management LLC boosted its stake in shares of Credit Acceptance by 230.6% in the first quarter. AQR Capital Management LLC now owns 7,885 shares of the credit services provider's stock valued at $3,961,000 after buying an additional 5,500 shares during the period. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its stake in shares of Credit Acceptance by 3.9% in the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 23,886 shares of the credit services provider's stock valued at $12,334,000 after buying an additional 900 shares during the period. Creative Planning grew its position in Credit Acceptance by 35.6% during the second quarter. Creative Planning now owns 529 shares of the credit services provider's stock worth $269,000 after buying an additional 139 shares in the last quarter. Finally, JPMorgan Chase & Co. grew its position in Credit Acceptance by 4.8% during the second quarter. JPMorgan Chase & Co. now owns 5,077 shares of the credit services provider's stock worth $2,586,000 after buying an additional 232 shares in the last quarter. Institutional investors own 81.71% of the company's stock.

About Credit Acceptance

Credit Acceptance Corporation, founded in 1972 and headquartered in Southfield, Michigan, is a specialty finance company focused on the indirect automotive lending market. The company partners with independent and franchised auto dealers to facilitate purchase financing for consumers who may not qualify for traditional prime auto loans. By purchasing retail installment contracts originated by these dealers, Credit Acceptance provides capital and credit insurance to support vehicle sales, enabling dealers to broaden their customer base and reduce credit risk.

Through its proprietary underwriting platform and risk management strategies, Credit Acceptance evaluates borrower applications, structures credit plans, and retains servicing rights on the acquired contracts.

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