Credit Acceptance Corp gross margin has been in long-term decline. The average rate of decline per year is -3%.
The historical rank and industry rank for Credit Acceptance's Gross Margin % or its related term are showing as below:
CACC'
s Gross Margin % Range Over the Past 10 Years
Min: 62.41 Med: 73.29 Max: 77.25
Current: 62.41
During the past 13 years, the highestGross Margin % of Credit Acceptance was 77.25%. The lowest was 62.41%. And the median was 73.29%.
CACC's Gross Margin % is ranked better than 59.02% of 366
companies
in the Credit Services industry
Industry Median: 55.305
vs CACC: 62.41
Credit Acceptance had a gross margin of 62.95% for the quarter that ended in Dec. 2024 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Credit Acceptance was -3.00% per year.
Credit Acceptance Gross Margin % Historical Data
The historical data trend for Credit Acceptance's Gross 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.
Competitive Comparison of Credit Acceptance's Gross Margin %
For the Credit Services subindustry, Credit Acceptance's Gross Margin %, along with its competitors' market caps and Gross 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 Gross Margin % Distribution in the Credit Services Industry
For the Credit Services industry and Financial Services sector, Credit Acceptance's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Credit Acceptance's Gross Margin % falls into.
* 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.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Credit Acceptance had a gross margin of 62.95% for the quarter that ended in Dec. 2024 => Durable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Credit Acceptance Gross Margin % Related Terms
Thank you for viewing the detailed overview of Credit Acceptance's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
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.
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