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The zones of discrimination for M-Score is as such:
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Good Sign:
Beneish M-Score -2.96 no higher than -1.78, which implies that the company is unlikely to be a manipulator.
The historical rank and industry rank for Credit Acceptance's Beneish M-Score or its related term are showing as below:
During the past 13 years, the highest Beneish M-Score of Credit Acceptance was -2.20. The lowest was -2.96. And the median was -2.56.
The historical data trend for Credit Acceptance's Beneish M-Score 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.
For the Credit Services subindustry, Credit Acceptance's Beneish M-Score, along with its competitors' market caps and Beneish M-Score 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.
For the Credit Services industry and Financial Services sector, Credit Acceptance's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Credit Acceptance's Beneish M-Score falls into.
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.
The M-Score Variables:
The M-score of Credit Acceptance for today is based on a combination of the following eight different indices:
M | = | -4.84 | + | 0.92 * DSRI | + | 0.528 * GMI | + | 0.404 * AQI | + | 0.892 * SGI | + | 0.115 * DEPI |
= | -4.84 | + | 0.92 * 1.0701 | + | 0.528 * 1.1009 | + | 0.404 * 0.9152 | + | 0.892 * 1.0313 | + | 0.115 * 0.9137 | |
- | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI | |||||||
- | 0.172 * 1.0558 | + | 4.679 * -0.120575 | - | 0.327 * 1.0219 | |||||||
= | -2.96 |
* 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.
This Year (Dec23) TTM: | Last Year (Dec22) TTM: |
Total Receivables was $6,960 Mil. Revenue was 485.4 + 473.2 + 472.6 + 449.7 = $1,881 Mil. Gross Profit was 323.9 + 319.5 + 319.9 + 300.2 = $1,264 Mil. Total Current Assets was $7,437 Mil. Total Assets was $7,610 Mil. Property, Plant and Equipment(Net PPE) was $47 Mil. Depreciation, Depletion and Amortization(DDA) was $27 Mil. Selling, General, & Admin. Expense(SGA) was $179 Mil. Total Current Liabilities was $400 Mil. Long-Term Debt & Capital Lease Obligation was $5,068 Mil. Net Income was 93.6 + 70.8 + 22.2 + 99.5 = $286 Mil. Non Operating Income was -1 + 0.5 + 0.4 + 0 = $-0 Mil. Cash Flow from Operations was 311.2 + 313.4 + 282.7 + 296.5 = $1,204 Mil. |
Total Receivables was $6,306 Mil. Revenue was 454.8 + 457.8 + 455.8 + 455.4 = $1,824 Mil. Gross Profit was 327.7 + 336.2 + 339.3 + 345.6 = $1,349 Mil. Total Current Assets was $6,728 Mil. Total Assets was $6,905 Mil. Property, Plant and Equipment(Net PPE) was $51 Mil. Depreciation, Depletion and Amortization(DDA) was $26 Mil. Selling, General, & Admin. Expense(SGA) was $164 Mil. Total Current Liabilities was $263 Mil. Long-Term Debt & Capital Lease Obligation was $4,591 Mil. |
1. DSRI = Days Sales in Receivables Index
Measured as the ratio of Revenue in Total Receivables in year t to year t-1.
A large increase in DSR could be indicative of revenue inflation.
DSRI | = | (Receivables_t / Revenue_t) | / | (Receivables_t-1 / Revenue_t-1) |
= | (6959.6 / 1880.9) | / | (6306.4 / 1823.8) | |
= | 3.700144 | / | 3.457835 | |
= | 1.0701 |
2. GMI = Gross Margin Index
Measured as the ratio of gross margin in year t-1 to gross margin in year t.
Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.
GMI | = | GrossMargin_t-1 | / | GrossMargin_t |
= | (GrossProfit_t-1 / Revenue_t-1) | / | (GrossProfit_t / Revenue_t) | |
= | (1348.8 / 1823.8) | / | (1263.5 / 1880.9) | |
= | 0.739555 | / | 0.671753 | |
= | 1.1009 |
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.
AQI | = | (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) | / | (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) |
= | (1 - (7437.3 + 46.5) / 7610.2) | / | (1 - (6728 + 51.4) / 6904.7) | |
= | 0.016609 | / | 0.018147 | |
= | 0.9152 |
4. SGI = Sales Growth Index
Ratio of Revenue in year t to sales in year t-1.
Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.
SGI | = | Sales_t | / | Sales_t-1 |
= | Revenue_t | / | Revenue_t-1 | |
= | 1880.9 | / | 1823.8 | |
= | 1.0313 |
5. DEPI = Depreciation Index
Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.
DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.
DEPI | = | (Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) | / | (Depreciation_t / (Depreciaton_t + PPE_t)) |
= | (25.6 / (25.6 + 51.4)) | / | (26.6 / (26.6 + 46.5)) | |
= | 0.332468 | / | 0.363885 | |
= | 0.9137 |
Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.
6. SGAI = Sales, General and Administrative expenses Index
The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.
SGA expenses index > 1 means that the company is becoming less efficient in generate sales.
SGAI | = | (SGA_t / Sales_t) | / | (SGA_t-1 /Sales_t-1) |
= | (178.9 / 1880.9) | / | (164.3 / 1823.8) | |
= | 0.095114 | / | 0.090087 | |
= | 1.0558 |
7. LVGI = Leverage Index
The ratio of total debt to Total Assets in year t relative to yeat t-1.
An LVGI > 1 indicates an increase in leverage
LVGI | = | ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) | / | ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) |
= | ((5067.5 + 399.8) / 7610.2) | / | ((4590.7 + 263.3) / 6904.7) | |
= | 0.718417 | / | 0.702999 | |
= | 1.0219 |
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
TATA | = | (IncomefromContinuingOperations_t | - | CashFlowsfromOperations_t) | / | TotalAssets_t |
= | (NetIncome_t - NonOperatingIncome_t | - | CashFlowsfromOperations_t) | / | TotalAssets_t | |
= | (286.1 - -0.1 | - | 1203.8) | / | 7610.2 | |
= | -0.120575 |
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Credit Acceptance has a M-score of -2.96 suggests that the company is unlikely to be a manipulator.
Thank you for viewing the detailed overview of Credit Acceptance's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
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 |
From GuruFocus
By PRNewswire 04-15-2023
By sperokesalga 03-02-2023
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