CACCNEUTRAL

Return on Equity (ROE)

28.1%

Higher than 80% of Financial Services sector peers

Updated 118h ago

Sector Performance

80th percentile

CACC

28.1%

Sector Median

12.4%

Sector Avg

17.4%

📊

Deep Analysis

Return on Equity (ROE) of 28.1% means that for every dollar of shareholder equity, Credit Acceptance Corporation generated 28.1 cents of profit in the most recent period — a measure of how efficiently the company uses investors' money.

This is well above the sector median of 12.4%, placing the stock in the 80th percentile among its Financial Services peers, indicating above-average profitability. The year-over-year change is not available, but the quarter-over-quarter change shows a +1.1% increase from the prior quarter's 27.8% to the current 28.1%. The combination of a high ROE and a slight upward trend implies that the company's profitability is strong and improving, which generally reduces investment risk relative to the sector. However, the overall NEUTRAL verdict suggests that this positive metric is offset by other factors, such as valuation or growth concerns. This metric supports a positive view but does not contradict the NEUTRAL stance, as the high ROE alone is insufficient to shift the overall assessment.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about CACC?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

How does CACC's Return on Equity (ROE) compare to its sector?

CACC's Return on Equity (ROE) of 28.1% compares to a Financial Services sector median of 12.4%, placing it in the 80th percentile.

Who are CACC's closest peers by Return on Equity (ROE)?

The closest Financial Services peers by Return on Equity (ROE) include: RF (11.9%), HSBC (11.6%), PNC (11.4%), GOLD (10.8%), PRU (10.7%).

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.