NASDAQ:CACC
$43.56
(3/18 3:55PM)
+0.6%
| Open | $43.55 |
Mkt Cap | $1.4 Billion |
| High | $43.96 |
52Wk High | $53.97 |
| Low | $42.78 |
52Wk Low | $19.01 |
| Volume | 17,736 |
Avg Vol 10D | 39,600 |
Ockham's Rating/Recommendation Summary
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CACC Revenue
As a value investing shop, we are interested in seeing how CACC's revenues measure up against past performances. One easily understandable way of doing that is to compare Price to Sales per share levels over a given time frame. Assuming it is available, Ockham prefers to look at ten years of history (for this stock there are 10 years of history available) and we weigh recent years more heavily. This allows us to find weighted average historical high and low Price to Sales ratios, which give us a better idea of the stock's current underlying value. Using this method, we have established a high range for Price to Sales of 4.78x and the low end of the range at 1.92x.
With respect to these historically rational metrics, notice that the current Price to Sales per share ratio for CACC of 3.59x is above its historical average only slightly. So, while not a major concern it is worth noting that from a value perspective CACC does not look undervalued on a Price to Sales basis. However, were the Price to Sales ratio to drop by 7% (the historical average) then we would become more positive on this stock.
CACC Cash Earnings
Looking at CACC specifically in their Cash Earnings capabilities, Ockham views CACC as significantly below its historical average multiple of Cash Earnings. Looking at the last 10 years we can get a good understanding of what investors have grown to expect from CACC. For example, CACC's Cash Earnings ratio per share has fluctuated between 7.18 and 17.93 over this historical timeframe. This range is based upon a proprietary weighted methodology at Ockham, but can clearly show an investor where CACC is with respect to prior business periods.
So what does "significantly below" mean when we talk about Price to Cash Earnings numbers for CACC? From the Ockham perspective, we are looking specifically at CACC to see if the market is recognizing the huge disparity between CACC's past stock price to Cash Earnings ratio to today's levels. At a difference of 26% below the average historical Price to Cash Earnings ratio, our view would be quite positive at this point. However, as with all metrics, we need to also take other factors into account when looking at CACC. While we view better Cash Earnings metrics as very important, if the market is slow to identify this value, or if Cash Earnings were to fall from these levels, we would become more neutral in our stance.
CACC Dividends
A strong dividend payment history is looked upon as a favorable characteristic on a company’s future and potentially can receive a positive Ockham rating. That being said, we don't require dividend payments for company's whose management has elected to forgo them entirely. Although they may currently pay a dividend, our data source has no historical record of it for CACC. Since we cannot apply our historical trend analysis to dividends for CACC we have a neutral score for the dividend portion of our analysis.
Credit Acceptance Corporation (CACC) Discussed on Fox Business's Money For Breakfast
Credit Acceptance Corporation is in the news. Find out how this impacts CACC trading on Ockham Research.
Foxbusiness.Com live, we have charles here. Monday, moving around a lot. Where do you want to start? Charles: it was tough over the weekend to find things that might move but I found it interesting article on CREDIT ACCEPTANCE, featured in daily stock report, the stock, a 50% move to the upside. What is interesting is they make a network of 2300 used car dealers. They say it is a good model to make a loan to anybody. Stocks made a big move this year but they think they could make a better move. We talked about the risk of these types of loans. Connell: it already had a big that one is down a little bit in pre-market. Charles: might be some serious pressure. Gordon johnson ii had negative comments on the entire solar space, seemed like he had particular anxiety, his big call was solar, talks about creative accounting, positive press releases, he seems to think this
“… ort, the stock, a 50% move to the upside. What is interesting is they make a network of 2300 used car dealers. They say it is a good model to make a loan to anybody. Stocks made a big move this year but they think they could make a better move. We talked about the risk of these types of loans. Connell: it already had a big that one is down a little bit in pre-market. Charles: might be some serious pressure. Gordon johnson ii had negative comments on the entire solar space, seemed like he had particular anxiety, his big call was solar, talks about creative accounting, positive press releases, he seems to think this …”