Auto finance companies:
I'll pass on ALLY. Not enough public history that I see. Roe negative some years.
CPSS. Low p/e, good roe, good rev growth (per Yahoo). Erratic earnings history though. A trade here perhaps. I'll pass.
CACC. Have held a few shares for several years. Small add recently. I like the long-term story. Good history of roe, high profit margins, generally increasing stated bv. I like CACC's business model, assuming I understand it: Instead of purchasing/financing loans from car dealers as other finance companies do, the company partners with the dealers. Which is to say, CACC, in exchange for the car dealers making some effort to ascertain that the buyers can actually make payments on their purchases through the end of financing, CACC will make some payments to the dealers. (I believe over the time of the loan. I could be wrong here.) So presumably CACC gets the dealers' first choice of the dealers' best customers.
CRMT: I have a few shares of this "finance" "pay here, buy here" company. Profitable every year past ten, okay roe, increasing stated bv every year. I wouldn't call the stock undervalued at current price. Steady business though; I look for the stock price to improve over the next 18 months. |
