Core Points - Credit Acceptance Corporation is set to release its third quarter 2025 earnings on October 30, 2025, after market close [1] - A conference call and webcast will take place on the same day at 5:00 p.m. Eastern Time to discuss the earnings [2] - The webcast will be accessible via the company's Investor Relations website, and a replay will be available afterward [3] Company Description - Credit Acceptance Corporation provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers with varying credit histories [4] - The company's financing programs help consumers who might otherwise be unable to purchase vehicles, thereby improving their credit scores and enabling access to traditional financing sources [5]

Core Insights - Credit Acceptance Corporation has been recognized as one of the 2025 US Fortune Best Workplaces for Women™, ranking 11 on the Top 100 Large Company list, an improvement of 18 spots from the previous year [1][2] - The company emphasizes a remote-first work environment and initiatives like "DrivHER," a resource group for female team members, to support women's professional growth [2][3] - Credit Acceptance has received ten workplace awards this year, including 34 on Fortune's 2025 100 Best Companies to Work For list and 1 on the 2025 Top Workplaces for Remote Work list [3] Company Overview - Credit Acceptance provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history [4] - The company's financing programs help consumers improve their credit scores, allowing them to transition to more traditional financing options [5] Industry Context - The 2025 Fortune Best Workplaces for Women list was created by analyzing survey responses from nearly 605,000 women employees at Great Place To Work Certified companies [6] - Eligibility criteria for the list include having at least 50 women employees, 20% of non-executive managers being women, and at least one female C-suite executive [6]

Core Thesis - Credit Acceptance Corporation (CACC) presents a compelling investment opportunity due to its historical performance, potential earnings rebound, and favorable market conditions [1][4]. Company Overview - CACC is a seasoned subprime auto lender with over 50 years of operations, having compounded shareholder value significantly, with a stock return of 170x since 1992, translating to a 25% CAGR [2]. - Despite its strong franchise and disciplined capital allocation, the stock trades at approximately 8x normalized EPS, similar to levels six years ago, even as the loan book expanded by around 50% and share count halved [2]. Financial Performance - Recent underperformance is attributed to weak loan cohorts from 2021 to 2023, which negatively impacted revenue yields and profitability [3]. - As these older cohorts season and newer vintages with stricter underwriting come into play, earnings are expected to rebound sharply from 2026 onward [3]. - Management's conservative adjustments and improving revenue and finance charge yields indicate that an earnings inflection is underway [3]. Market Conditions - The withdrawal of the CFPB lawsuit has removed a regulatory overhang, enhancing the investment appeal of CACC [4]. - The potential for significant buybacks could further enhance per-share value, with the stock trading at 11x 2025E EPS and expected to exceed $60 EPS by 2026 and $100 by 2029 [4]. - The stock offers an expected IRR of over 30%, making current levels an attractive long-term entry point [4]. Comparative Analysis - Similar to Upstart Holdings, CACC emphasizes disciplined underwriting and the potential for earnings rebound, despite facing macroeconomic headwinds [5].

Core Insights - Credit Acceptance Corporation has been recognized as one of America's Top 100 Most Loved Workplaces for 2025, ranking sixth and improving by four spots from the previous year [1][2] - The recognition is based on employee feedback, emphasizing the importance of a supportive and empowering workplace culture [2][4] - The company has received nine workplace awards in 2025, including high rankings on various prestigious lists such as Fortune's 100 Best Companies to Work For and PEOPLE Magazine's 100 Companies That Care [3] Company Overview - Credit Acceptance provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers with varying credit histories [5][6] - The company's financing programs help consumers improve their credit scores, allowing them to transition to more traditional financing options [6] Recognition and Research - The Most Loved Workplaces list is based on research by Best Practice Institute, which evaluates employee experiences in areas like emotional connection and collaboration [4][7] - Over 2.8 million U.S. employees were surveyed, along with interviews from executives to assess workplace culture and leadership [4]

Core Insights - Credit Acceptance Corporation has been recognized as a 2025 Top Workplace for Remote Work, ranking 1 in the 1,000-2,499 employee category, an improvement from the previous year [1] - The company emphasizes a remote-first policy, with 95% of team members agreeing that it is a great place to work, highlighting the importance of flexibility and work-life balance [2] - This recognition is part of a broader trend, as the company has received eight workplace awards this year, including 34 on Fortune's 2025 100 Best Companies to Work For list [3] Company Overview - Credit Acceptance provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history [4] - The financing programs help consumers who might otherwise be unable to purchase vehicles, allowing them to improve their credit scores and access traditional financing options in the future [5] Recognition and Awards - The Top Workplaces Awards are based on a survey by Energage, which measures 15 Culture Drivers that predict high performance against industry benchmarks [3] - The company has achieved notable rankings in various workplace awards, reflecting its commitment to employee satisfaction and a positive work culture [3]

Company Recognition - Credit Acceptance Corporation has been named to the 2025 Fortune Best Workplaces in Financial Services & Insurance list for the eleventh consecutive year, ranking 10th among 50 large companies, an improvement of 3 spots from the previous year [1] - The recognition reflects the company's culture built on trust, purpose, and investment in employees, as stated by the CEO [2] Workplace Culture - The company offers a remote-first work environment, flexible scheduling, and generous paid time off, focusing on both physical and mental well-being [3] - Compensation is aligned with individual and company success, with annual reviews based on core values to ensure equity and transparency [3] Industry Context - The Best Workplaces in Financial Services & Insurance list is based on employee survey results from over 1.3 million employees, with more than 194,000 responses from employees in the financial services and insurance sectors [4][7] - The rankings are derived from 60 employee experience questions within the Great Place To Work Trust Index Survey, highlighting the importance of trust, fairness, and inclusivity in the workplace [4][7] Company Operations - Credit Acceptance provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history [5] - The financing programs help consumers improve their credit scores, allowing them to transition to traditional financing sources [6]

Core Insights - Credit Acceptance Corporation has been recognized as one of PEOPLE Magazine's 100 Companies That Care for the fourth consecutive year, ranking 44th, which is an improvement of 15 spots from the previous year [1] - The recognition reflects the company's commitment to a culture of compassion and support for team members, customers, and communities, which is believed to drive long-term success [2] - The company has received six workplace awards this year, including 34 on Fortune's 2025 100 Best Companies to Work For list and 2 on the 2025 Top Workplaces USA list [3] Company Overview - Credit Acceptance provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history, thus facilitating vehicle ownership [5] - The company reports to three national credit reporting agencies, allowing consumers to improve their credit scores and access more traditional financing options [6] Recognition Process - The PEOPLE Magazine's 100 Companies That Care list is based on over 1.3 million employee survey responses and data from companies representing more than 8.4 million employees [4][7] - Rankings are derived from 60 employee experience questions within the Great Place To Work Trust Index Survey and validated essays submitted by participating companies [7] Community Impact - Credit Acceptance has delivered automobile financing to hundreds of thousands of underserved Americans and has engaged in various community initiatives, such as packing over 106,000 meals for local food banks and granting wishes through Make-A-Wish [8]

Core Insights - Credit Acceptance Corporation has been recognized on the 2025 Crain's Fast 50 list for the ninth time, highlighting its status as one of the fastest-growing companies in metro Detroit [1][3] - The company's revenue has increased by 29.5% over the past five years, reaching $2.2 billion in 2024, reflecting the effectiveness of its unique financing approach for automobile dealers [2][3] Company Overview - Credit Acceptance provides innovative financing solutions that enable automobile dealers to sell vehicles to consumers regardless of their credit history, thus facilitating vehicle ownership [4][5] - The financing programs are designed to benefit both dealers and consumers, allowing for sales to customers who might otherwise be unable to obtain financing [4][5] Awards and Recognition - In addition to the Crain's Fast 50 recognition, Credit Acceptance has received multiple workplace awards in 2025, including 34 on Fortune's 100 Best Companies to Work For list and 2 on the Top Workplaces USA list [3]

Core Insights - Credit Acceptance Corporation (CACC) reported second-quarter 2025 adjusted earnings per share (EPS) of $8.56, which fell short of the Zacks Consensus Estimate of $9.84 and represented an 18.6% decline year over year [1][9] - The company's net income, including non-recurring items, was $87.4 million or $7.42 per share, a significant recovery from a net loss of $47.1 million or $3.83 per share in the same quarter last year [2] Financial Performance - Total GAAP revenues for the quarter reached $583.8 million, marking an 8.5% increase year over year, although it missed the Zacks Consensus Estimate of $585 million [3][9] - The provision for credit losses decreased significantly by 46.2% to $172.6 million, while operating expenses surged by 25% to $155.5 million [3][9] - As of June 30, 2025, net loans receivable stood at $8 billion, reflecting a 1.9% increase from the end of December 2024 [3] Asset and Equity Position - Total assets were reported at $8.72 billion, down from $8.85 billion as of December 31, 2024 [4] - Total shareholders' equity decreased to $1.55 billion from $1.75 billion as of December 31, 2024 [4] Shareholder Actions - During the reported quarter, Credit Acceptance repurchased approximately 0.53 million shares [5] Market Outlook - The company faces challenges from rising operating expenses, which are expected to negatively impact bottom-line growth, alongside concerns regarding asset quality due to a tough operating environment [6] - Despite these challenges, the company is positioned for revenue growth due to a gradual increase in demand for consumer loans [6]

Core Viewpoint - Credit Acceptance (CACC) reported quarterly earnings of $8.56 per share, missing the Zacks Consensus Estimate of $9.84 per share, but showing an improvement from a loss of $3.83 per share a year ago [1] Financial Performance - The company posted revenues of $583.8 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 0.21%, compared to year-ago revenues of $538.2 million [2] - Over the last four quarters, the company has surpassed consensus EPS estimates just once [2] - The current consensus EPS estimate for the coming quarter is $10.30 on revenues of $588.45 million, and for the current fiscal year, it is $39.34 on revenues of $2.34 billion [7] Stock Performance and Outlook - Credit Acceptance shares have added about 7.5% since the beginning of the year, compared to the S&P 500's gain of 8.2% [3] - The company's earnings outlook and estimate revisions trend are crucial for understanding future stock movements, with the current Zacks Rank being 4 (Sell), indicating expected underperformance in the near future [6] Industry Context - The Financial - Consumer Loans industry, to which Credit Acceptance belongs, is currently in the bottom 28% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor decisions [5]