Well, the earnings were juiced in 2012 (at least relative to 2010-2011, that's as far back as I have gone) due to the lack of provision (other than dealer discount) for bad debt right? Looks to me like mid-cycle eps is around $1.20 (better than 2010 not as good as 2011, but with a small bump for growth). 10x mid cycle is okay but not screamingly cheap from where I sit relative to NICK's history (relative to competitors and the market, different story).
Your 6.5 P/E assumes EPS holds - It won't. My preliminary view is that EPS will likely go below 40c/q over the next 4 Qs. Expect provision to ramp back to 1MM soon. Could be worse if Manheim used car price index goes below 115.
This should be no surprise though - Well telegraphed tough environment with a) Peter's Performance hurdles lowered for bonus (see proxy), b) CFO selling a few months back, c) Origination volume struggling due to white hot competition and d) Dealer Discount getting sacrificed.
Peter needs to keep increasing the dividend to return capital to the shareholders. He won't though due to the unknown of the down cycle that the industry is entering.