Credit Acceptance (CACC) Stock Jumps 6.2%: Will It Continue to Soar?
Credit Acceptance CACC shares soared 6.2% in the last trading session to close at $526.58. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 12.3% loss over the past four weeks.
The stock witnessed a rise in price for the 3rd consecutive day. The performance of consumer loan providers is expected to improve significantly in the quarters ahead on the back of rising interest rates. In mid-June, the Federal Reserve hiked interest rates by 75 basis points, following one smaller hike in May and another in March. More such rate hikes are expected in the year to tame the raging inflation. This has led to the bullish investor sentiments, which drove Credit Acceptance stock higher.
This auto financing company is expected to post quarterly earnings of $13.09 per share in its upcoming report, which represents a year-over-year change of -23.8%. Revenues are expected to be $443.73 million, down 5.9% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Credit Acceptance, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on CACC going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Credit Acceptance is part of the Zacks Financial - Consumer Loans industry. Sallie Mae SLM, another stock in the same industry, closed the last trading session 2.1% lower at $16.20. SLM has returned -15.3% in the past month.
For Sallie Mae , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.02. This represents a change of +126.7% from what the company reported a year ago. Sallie Mae currently has a Zacks Rank of #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Credit Acceptance Corporation (CACC) : Free Stock Analysis Report
SLM Corporation (SLM) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
