CACC Stock Tanks 8% as Q3 Earnings Lag on Higher Provisions

Core Viewpoint - Credit Acceptance Corporation (CACC) reported disappointing third-quarter 2024 results, with earnings per share of $6.95 falling short of the Zacks Consensus Estimate of$7.88, despite a year-over-year growth of 16.9% in the bottom line [1][2]. Financial Performance - Total GAAP revenues for CACC reached $550.3 million, reflecting a 15$542 million [3]. - Adjusted net income, excluding non-recurring items, was $109.1 million or$8.79 per share, down from $139.5 million or$10.70 per share in the same quarter last year [2]. - Operating expenses rose to $129.4 million, an increase of 17.1$7.78 billion, marking an 11.9% increase from December 2023 [3]. - Total assets increased to $8.68 billion from$7.61 billion as of December 31, 2023, while total shareholders' equity decreased to $1.65 billion from$1.75 billion [4]. - Consumer loan assignment volumes increased by 17.7% in units and 12.2% in dollar volumes year over year [4]. Market Position and Outlook - The company is facing challenges from rising expenses and potential asset quality issues, which may hinder financial performance in the near term [5]. - Despite these challenges, CACC is positioned for revenue growth due to increasing demand for consumer loans [5].