AXQ Capital LP Invests $1.13 Million in Credit Acceptance Corporation $CACC

Key Points

• AXQ Capital LP initiated a $1.13 million position in Credit Acceptance during the second quarter by purchasing 1,770 shares. Institutional investors collectively own 81.71% of the company.
• Credit Acceptance shares opened at $604.72, near their 50-day average and below the 12-month high of $668.86. The company reported quarterly EPS of $12.12, slightly below expectations, while revenue rose 0.6% year over year to $415 million.
• Analyst sentiment remains cautious, with a consensus “Hold” rating and an average price target of $570. Company insiders sold more than 44,000 shares worth approximately $27.5 million over the past 90 days.

AXQ Capital LP bought a new stake in shares of Credit Acceptance Corporation (NASDAQ:CACC - Free Report) during the 2nd quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The fund bought 1,770 shares of the credit services provider's stock, valued at approximately $1,127,000.

Other hedge funds and other institutional investors also recently made changes to their positions in the company. Nykredit A S purchased a new stake in Credit Acceptance in the second quarter worth $161,000. Susquehanna Fundamental Investments LLC purchased a new position in Credit Acceptance during the 2nd quarter valued at $1,051,000. Two Sigma Securities LLC bought a new position in Credit Acceptance in the 2nd quarter worth $811,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC raised its holdings in Credit Acceptance by 8.7% in the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 19,393 shares of the credit services provider's stock worth $12,348,000 after purchasing an additional 1,549 shares in the last quarter. Finally, Wellington Management Group LLP lifted its position in shares of Credit Acceptance by 0.5% in the 2nd quarter. Wellington Management Group LLP now owns 260,084 shares of the credit services provider's stock worth $165,606,000 after purchasing an additional 1,186 shares during the period. Institutional investors own 81.71% of the company's stock.

Credit Acceptance Stock Performance

Shares of CACC stock opened at $604.72 on Friday. The company's fifty day moving average price is $602.14 and its 200-day moving average price is $542.79. The stock has a market cap of $6.33 billion, a PE ratio of 13.30 and a beta of 1.35. The company has a current ratio of 14.89, a quick ratio of 14.89 and a debt-to-equity ratio of 3.84. Credit Acceptance Corporation has a 12 month low of $401.90 and a 12 month high of $668.86.

Credit Acceptance (NASDAQ:CACC - Get Free Report) last issued its quarterly earnings results on Tuesday, August 4th. The credit services provider reported $12.12 earnings per share (EPS) for the quarter, missing the consensus estimate of $12.20 by ($0.08). Credit Acceptance had a return on equity of 31.67% and a net margin of 21.54%.The business had revenue of $415.00 million during the quarter, compared to the consensus estimate of $588.07 million. During the same quarter in the previous year, the business earned $10.05 earnings per share. The firm's revenue was up .6% compared to the same quarter last year. On average, equities analysts expect that Credit Acceptance Corporation will post 47.8 EPS for the current fiscal year.

Analyst Upgrades and Downgrades

A number of equities research analysts have recently weighed in on CACC shares. TD Cowen lifted their target price on shares of Credit Acceptance from $575.00 to $600.00 and gave the company a "hold" rating in a research note on Wednesday, August 5th. Weiss Ratings upgraded shares of Credit Acceptance from a "hold (c+)" rating to a "buy (b-)" rating in a report on Thursday, July 16th. Finally, Zacks Research cut Credit Acceptance from a "strong-buy" rating to a "hold" rating in a research report on Wednesday, May 13th. One investment analyst has rated the stock with a Buy rating and three have assigned a Hold rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Hold" and an average target price of $570.00.

Insider Transactions at Credit Acceptance

In related news, insider Erin Kerber sold 5,720 shares of the company's stock in a transaction that occurred on Friday, June 26th. The stock was sold at an average price of $629.80, for a total value of $3,602,456.00. Following the sale, the insider owned 25,711 shares in the company, valued at $16,192,787.80. This represents a 18.20% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Nicholas Elliott sold 2,306 shares of the firm's stock in a transaction that occurred on Friday, June 26th. The shares were sold at an average price of $629.99, for a total value of $1,452,756.94. Following the transaction, the insider directly owned 20,897 shares of the company's stock, valued at approximately $13,164,901.03. This trade represents a 9.94% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders sold 44,289 shares of company stock worth $27,525,241. Company insiders own 6.10% 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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