Citron Research Says ‘Bull Case Won’ On Credit Acceptance

by | Mar 4, 2026 | General

Andrew Left‘s Citron Research reversed course on Credit Acceptance Corporation (NASDAQ:CACC) Wednesday.

The short-seller-turned-bull issued a new report titled “Citron Re-Examines $CACC: Skeptics No More. Bull Case Won.”

Citron set a $714 fair value, implying roughly 44% upside from current levels.

This marks Citron’s first-ever positive call on the subprime auto lender.

From Bear to Bull: What Changed at Citron

Citron had long flagged CACC’s regulatory exposure as a serious threat. The firm now says it got the headline right but the business completely wrong.

“We were among those who believed the regulatory scrutiny posed existential risk. We were wrong,” Citron wrote Wednesday.

The firm cited CACC’s resolution of both the New York Attorney General and Consumer Financial Protection Bureau investigations — simultaneously — on Feb. 13. Citron called the dual resolution rare and said the market has not yet priced it in.

The Valuation Gap

Citron’s $714 base case uses 16 times estimated 2026 earning per share of $44.62 — CACC’s historical multiple. The stock currently trades at a 30% discount to that range. A full tech re-rating scenario pushes fair value to $893.

The Buyback Machine: 61% of Float Gone Since 2011

Citron called CACC a “cannibal capital allocator.” The company retired 61% of its float since 2011. In 2025 alone, it bought back 12.6% of the entire company.

Shares outstanding fell from 27 million in 2011 to roughly 10.5 million today.

Citron compared CACC’s buyback trajectory to AutoZone (NYSE:AZO), NVR Inc. (NYSE:NVR) and O’Reilly Automotive (NASDAQ:ORLY) — all multi-thousand-percent performers over 20 years. CACC, Citron argued, is in the early innings of that same compounding dynamic.

The Hegde Factor

CEO Vinayak Hegde — a 12-year Amazon veteran — has cut dealer approval times to under two seconds and raised technology deployment speed 70%. Citron called his yet-unscheduled investor day “a free option sitting in the stock.”

Short Interest

Short interest in Credit Acceptance Corporation fell from 1.26 million to 1.18 million shares last period, yet roughly 32% of the float remains sold short.

With average daily volume around 268,850 shares, it would take about 4.4 days for shorts to fully cover.

CACC Price Action: Credit Acceptance shares were up 0.80% at $485.08 at the time of publication on Wednesday, according to Benzinga Pro data.

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