Credit Acceptance Corporation - "C is for Collapse"
Executive Summary The accounting practices used by Credit Acceptance Corporation ( CACC ) front-load revenue and understate write-offs, thus inflating earnings by 30% to 40% as well as Loans Receivable, which could be overstated by up to 25%. CACC is facing pressure from regulators, which could potentially result in a requirement to re-state financial accounts, fines and / or restitution to customers. CACC Thesis ( link ) CACC Presentation ( link ) CarMax Auto Owner Trust securitisation performance reports ( link ) Recent Events - On Wednesday, January 31st, $CACC held its Q4 earnings call, where management (inadvertently) admitted to fudging the numbers ( link ). - On Friday, February 2nd, after markets close, $CACC published the following press release: o "On November 20, 2017 we received a second civil investigation demand from the Office of the Atto...