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CACC (Credit Acceptance) Operating Margin % : 18.36% (As of Sep. 2024)


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What is Credit Acceptance Operating Margin %?

Operating Margin % is calculated as Operating Income divided by its Revenue. Credit Acceptance's Operating Income for the three months ended in Sep. 2024 was $100 Mil. Credit Acceptance's Revenue for the three months ended in Sep. 2024 was $544 Mil. Therefore, Credit Acceptance's Operating Margin % for the quarter that ended in Sep. 2024 was 18.36%.

Warning Sign:

Credit Acceptance Corp operating margin has been in a 5-year decline. The average rate of decline per year is -16.3%.

The historical rank and industry rank for Credit Acceptance's Operating Margin % or its related term are showing as below:

CACC' s Operating Margin % Range Over the Past 10 Years
Min: 12.29   Med: 55.98   Max: 67.85
Current: 12.29


CACC's Operating Margin % is ranked worse than
58.78% of 393 companies
in the Credit Services industry
Industry Median: 19.48 vs CACC: 12.29

Credit Acceptance's 5-Year Average Operating Margin % Growth Rate was -16.30% per year.

Credit Acceptance's Operating Income for the three months ended in Sep. 2024 was $100 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Sep. 2024 was $253 Mil.

Warning Sign:

Credit Acceptance Corp has recorded a loss in operating income at least once over the past 3 years.


Credit Acceptance Operating Margin % Historical Data

The historical data trend for Credit Acceptance's Operating Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Credit Acceptance Operating Margin % Chart

Credit Acceptance Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Operating Margin %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 57.33 33.20 67.85 38.52 18.48

Credit Acceptance Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
Operating Margin % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 19.18 23.07 15.97 -7.25 18.36

Competitive Comparison of Credit Acceptance's Operating Margin %

For the Credit Services subindustry, Credit Acceptance's Operating Margin %, along with its competitors' market caps and Operating Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Credit Acceptance's Operating Margin % Distribution in the Credit Services Industry

For the Credit Services industry and Financial Services sector, Credit Acceptance's Operating Margin % distribution charts can be found below:

* The bar in red indicates where Credit Acceptance's Operating Margin % falls into.



Credit Acceptance Operating Margin % Calculation

Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.

Credit Acceptance's Operating Margin % for the fiscal year that ended in Dec. 2023 is calculated as

Operating Margin %=Operating Income (A: Dec. 2023 ) / Revenue (A: Dec. 2023 )
=347.3 / 1879.8
=18.48 %

Credit Acceptance's Operating Margin % for the quarter that ended in Sep. 2024 is calculated as

Operating Margin %=Operating Income (Q: Sep. 2024 ) / Revenue (Q: Sep. 2024 )
=99.8 / 543.6
=18.36 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Credit Acceptance  (NAS:CACC) Operating Margin % Explanation

Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.


Be Aware

Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia’s Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.


Credit Acceptance Operating Margin % Related Terms

Thank you for viewing the detailed overview of Credit Acceptance's Operating Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.


Credit Acceptance Business Description

Traded in Other Exchanges
Address
25505 W. Twelve Mile Road, Southfield, MI, USA, 48034-8339
Credit Acceptance Corp is a consumer finance company that specializes in automobile loans. These loans are offered through a U.S. nationwide network of automobile dealers that benefit from sales of vehicles to consumers who could otherwise not obtain financing. The company also benefits from repeat and referral sales, and from sales to customers responding to advertisements for financing, but qualify for traditional financing. The company derives its revenue from finance charges, premiums earned on the reinsurance of vehicle service contracts, and other fees. Of these, financing charges, including servicing fees, are by far a source of revenue.
Executives
Prescott General Partners Llc 10 percent owner, other: Member of Section 13(d) Group 2200 BUTTS ROAD, SUITE 320, BOCA RATON FL 33431
Thomas W Smith 10 percent owner, other: Member of Section 13(d) Group 2200 BUTTS ROAD, SUITE 320, BOCA RATON FL 33431
Daniel A. Ulatowski officer: Chief Sales Officer 25505 W 12 MILE ROAD, SOUTHFIELD MI 48034
Douglas W Busk officer: Sr. Vice President & Treasurer 25505 WEST TWELVE MILE ROAD, SOUTH FIELD MI 48034
Jonathan Lum officer: Chief Operating Officer 25505 W 12 MILE ROAD, SOUTHFIELD MI 48034
Erin J Kerber officer: Chief Legal Officer 25505 WEST TWELVE MILE RD, SOUTHFIELD MI 48034
Wendy A Rummler officer: Senior VP, Human Resources 25505 WEST TWELVE MILE ROAD, SOUTHFIELD MI 48034
Nicholas J Elliott officer: Chief Alignment Officer 25505 WEST TWELVE MILE RD, SOUTHFIELD MI 48034
Arthur L Smith officer: Chief Analytics Officer 25505 W 12 MILE ROAD, SOUTHFIELD MI 48034
Sean Edward Quinn director C/O CIMPRESS PLC, 275 WYMAN STREET, WALTHAM MA 02451
Scott J Vassalluzzo director, 10 percent owner, other: Member of Section 13(d) Group 2200 BUTTS ROAD, SUITE 320, BOCA RATON FL 33431
Donald A. Foss Irrevocable Trust Dated August 14, 2022 10 percent owner 39395 W. TWELVE MILE ROAD, SUITE 200, FARMINGTON HILLS MI 48331
Andrew K Rostami officer: Chief Mktg and Product Officer 25505 WEST TWELVE MILE ROAD, SOUTHFIELD MI 48034
Ravi Mohan Valiyaveettil officer: Chief Technology Officer 25505 WEST TWELVE MILE RD, SOUTHFIELD MI 48034
Thomas N Tryforos director 323 RAILROAD AVE, GREENWICH CT 06830