GURUFOCUS.COM » STOCK LIST » Financial Services » Credit Services » Credit Acceptance Corp (NAS:CACC) » Definitions » ROA %

Credit Acceptance (Credit Acceptance) ROA %

: 4.99% (As of Dec. 2023)
View and export this data going back to 1992. Start your Free Trial

ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. Credit Acceptance's annualized Net Income for the quarter that ended in Dec. 2023 was $374 Mil. Credit Acceptance's average Total Assets over the quarter that ended in Dec. 2023 was $7,504 Mil. Therefore, Credit Acceptance's annualized ROA % for the quarter that ended in Dec. 2023 was 4.99%.

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

CACC' s ROA % Range Over the Past 10 Years
Min: 3.94   Med: 9.67   Max: 13.18
Current: 3.94

During the past 13 years, Credit Acceptance's highest ROA % was 13.18%. The lowest was 3.94%. And the median was 9.67%.

CACC's ROA % is ranked better than
69.89% of 538 companies
in the Credit Services industry
Industry Median: 1.88 vs CACC: 3.94

Credit Acceptance ROA % Historical Data

The historical data trend for Credit Acceptance's ROA % 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 Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
ROA %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 9.61 5.65 13.18 7.68 3.94

Credit Acceptance Quarterly Data
Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23
ROA % 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 Premium Member Only Premium Member Only Premium Member Only 7.38 5.66 1.24 3.88 4.99

Competitive Comparison

For the Credit Services subindustry, Credit Acceptance's ROA %, along with its competitors' market caps and ROA % 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 ROA % Distribution

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

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



Credit Acceptance ROA % Calculation

Credit Acceptance's annualized ROA % for the fiscal year that ended in Dec. 2023 is calculated as:

ROA %=Net Income (A: Dec. 2023 )/( (Total Assets (A: Dec. 2022 )+Total Assets (A: Dec. 2023 ))/ count )
=286.1/( (6904.7+7610.2)/ 2 )
=286.1/7257.45
=3.94 %

Credit Acceptance's annualized ROA % for the quarter that ended in Dec. 2023 is calculated as:

ROA %=Net Income (Q: Dec. 2023 )/( (Total Assets (Q: Sep. 2023 )+Total Assets (Q: Dec. 2023 ))/ count )
=374.4/( (7397.1+7610.2)/ 2 )
=374.4/7503.65
=4.99 %

* 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.

In the calculation of annual ROA %, the net income of the last fiscal year and the average total assets over the fiscal year are used. In calculating the quarterly data, the Net Income data used here is four times the quarterly (Dec. 2023) net income data. ROA % is displayed in the 30-year financial page.


Credit Acceptance  (NAS:CACC) ROA % Explanation

ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A bank’s ROA % is typically well under 2%.

Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:

ROA %(Q: Dec. 2023 )
=Net Income/Total Assets
=374.4/7503.65
=(Net Income / Revenue)*(Revenue / Total Assets)
=(374.4 / 1941.6)*(1941.6 / 7503.65)
=Net Margin %*Asset Turnover
=19.28 %*0.2588
=4.99 %

Note: The Net Income data used here is four times the quarterly (Dec. 2023) net income data. The Revenue data used here is four times the quarterly (Dec. 2023) revenue data.

* 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.


Be Aware

Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).

Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.

E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.


Credit Acceptance ROA % Related Terms

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


Credit Acceptance (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 the largest source of revenue.
Executives
Wendy A Rummler officer: Senior VP, Human Resources 25505 WEST TWELVE MILE ROAD, SOUTHFIELD MI 48034
Douglas W Busk officer: Sr. Vice President & Treasurer 25505 WEST TWELVE MILE ROAD, SOUTH FIELD 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
Thomas W Smith 10 percent owner, other: Member of Section 13(d) Group 2200 BUTTS ROAD, SUITE 320, BOCA RATON FL 33431
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
Daniel A. Ulatowski officer: Chief Sales Officer 25505 W 12 MILE ROAD, SOUTHFIELD MI 48034
Andrew K Rostami officer: Chief Mktg and Product Officer 25505 WEST TWELVE MILE ROAD, SOUTHFIELD MI 48034
Prescott General Partners Llc 10 percent owner, other: Member of Section 13(d) Group 2200 BUTTS ROAD, SUITE 320, BOCA RATON FL 33431
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
Kenneth Booth officer: Chief Financial Officer 25505 WEST TWELVE MILE ROAD, SOUTHFIELD MI 48034
Donald A Foss director, 10 percent owner, officer: Chairman 29777 TELEGRAPH ROAD, SUITE 2611, SOUTHFIELD MI 48034