Credit Acceptance (NASDAQ:CACC) Shares Gap Down - What's Next?

Key Points

• Credit Acceptance shares plunged: The stock opened at $497.91 versus a prior close of $575.78 and later traded near $480.34.
• Adjusted third-quarter results were stronger: Adjusted net income rose to $135.5 million, or $13.01 per share, beating the $12.86 analyst consensus, while revenue increased 2.1% year over year to $594.6 million.
• Investors remain concerned about earnings quality and outlook: The company reported a $56.6 million GAAP net loss, and a forecast change reportedly disappointed investors. Analysts’ average rating is “Hold,” with a consensus price target of $565.

Shares of Credit Acceptance Corporation (NASDAQ:CACC - Get Free Report) gapped down before the market opened on Friday. The stock had previously closed at $575.78, but opened at $497.91. Credit Acceptance shares last traded at $480.3350, with a volume of 70,766 shares traded.

Key Credit Acceptance News

Here are the key news stories impacting Credit Acceptance this week:

• Positive Sentiment: Third-quarter adjusted net income increased to $135.5 million, or $13.01 per diluted share, from $117.9 million, or $10.28 per share, a year earlier. Adjusted EPS also exceeded the $12.86 analyst consensus. Credit Acceptance Announces Third Quarter 2026 Results
• Positive Sentiment: Revenue rose approximately 2.1% year over year to $594.6 million. The company also highlighted a record number of dealers, supporting the potential for continued loan-origination growth. Credit Acceptance Q3 Revenue Earnings Flash
• Neutral Sentiment: Revenue was slightly below the FactSet estimate of $596.4 million, limiting the impact of the adjusted-EPS beat. Credit Acceptance Q3 Revenue Earnings Flash
• Negative Sentiment: Credit Acceptance reported a consolidated GAAP net loss of $56.6 million, or $5.43 per share, compared with net income of $108.2 million, or $9.43 per share, in the prior-year quarter. The sizable gap between GAAP and adjusted earnings increases investor uncertainty about the quality and sustainability of reported profits. Credit Acceptance Announces Third Quarter 2026 Results
• Negative Sentiment: Coverage of the results pointed to a forecast change that disappointed investors, offsetting the record dealer count and adjusted earnings growth. Credit Acceptance Q3 2026 Results

Analysts Set New Price Targets

Several equities research analysts recently commented on the company. TD Cowen dropped their target price on Credit Acceptance from $600.00 to $590.00 and set a "hold" rating on the stock in a report on Tuesday, October 6th. Weiss Ratings reaffirmed a "buy (b-)" rating on shares of Credit Acceptance in a research note on Wednesday, October 14th. One research analyst has rated the stock with a Buy rating and three have given a Hold rating to the company's stock. Based on data from MarketBeat, Credit Acceptance presently has an average rating of "Hold" and a consensus target price of $565.00.

Credit Acceptance Price Performance

The company has a current ratio of 14.89, a quick ratio of 14.89 and a debt-to-equity ratio of 3.84. The firm has a market cap of $4.78 billion, a price-to-earnings ratio of 10.05 and a beta of 1.40. The stock has a 50-day moving average of $566.72 and a two-hundred day moving average of $537.43.

Credit Acceptance (NASDAQ:CACC - Get Free Report) last issued its quarterly earnings results on Thursday, October 29th. The credit services provider reported $13.01 EPS for the quarter, beating the consensus estimate of $12.86 by $0.15. Credit Acceptance had a net margin of 21.54% and a return on equity of 31.67%. The business had revenue of $420.30 million during the quarter, compared to the consensus estimate of $596.40 million. During the same quarter in the prior year, the firm earned $10.28 EPS. The firm's quarterly revenue was up 2.1% on a year-over-year basis. On average, analysts anticipate that Credit Acceptance Corporation will post 47.64 EPS for the current year.

Institutional Trading of Credit Acceptance

A number of hedge funds have recently modified their holdings of the business. VIRGINIA RETIREMENT SYSTEMS ET Al acquired a new position in Credit Acceptance in the third quarter worth approximately $467,000. Root Financial Partners LLC acquired a new stake in Credit Acceptance in the third quarter valued at approximately $35,000. Nisa Investment Advisors LLC lifted its stake in Credit Acceptance by 2.4% in the third quarter. Nisa Investment Advisors LLC now owns 3,074 shares of the credit services provider's stock valued at $1,632,000 after acquiring an additional 73 shares during the last quarter. Fortitude Family Office LLC grew its position in Credit Acceptance by 1,060.0% in the third quarter. Fortitude Family Office LLC now owns 116 shares of the credit services provider's stock worth $62,000 after acquiring an additional 106 shares in the last quarter. Finally, GAMMA Investing LLC grew its position in Credit Acceptance by 181.7% in the third quarter. GAMMA Investing LLC now owns 169 shares of the credit services provider's stock worth $90,000 after acquiring an additional 109 shares in the last quarter. Hedge funds and other institutional investors own 81.71% of the company's stock.

About Credit Acceptance

Credit Acceptance Corporation NASDAQ: CACC is a specialized automobile finance company that provides financing programs for consumers who may have difficulty obtaining credit through traditional lenders. The company primarily operates through an indirect lending model, working with automobile dealers who offer financing to customers purchasing new or used vehicles.

Credit Acceptance purchases or services automotive loans originated through its dealer-partner network. Its programs are designed to help dealers sell vehicles to a broader range of consumers, while the company manages loan underwriting, servicing, collections, and related risk-management activities.

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