Credit Acceptance Corporation (CACC) vs Klarna Group plc (KLAR)

Credit Acceptance Corporation and Klarna Group plc are both Credit Services companies. Credit Acceptance Corporation is the larger, with a market value of $5.7B against $4.9B — 1.2× the size. Klarna Group plc has negative trailing earnings, so its P/E is not meaningful; Credit Acceptance Corporation trades at 12.0×. Klarna Group plc grew revenue faster over the last twelve months: 34.2% against 2.58%. Credit Acceptance Corporation has the higher net margin (21.5% vs −3.52%) and the higher return on invested capital (10.0% vs 0.00%). Across the 17 metrics below, Credit Acceptance Corporation leads on 12 and Klarna Group plc on 5.

Valuation

Metric CACC KLAR Credit Services median
P/E 12.04 n/m 9.64
P/S 2.51 1.20 0.87
P/B 3.68 1.82 1.16
Price to free cash flow 4.79 n/m 2.99
EV/EBITDA 9.70 n/m 9.58
EV/Sales 4.95 (0.10) 2.32
Earnings yield 8.31% (2.89%) 6.72%
Free cash flow yield 20.86% (78.64%) 12.33%

Profitability

Metric CACC KLAR Credit Services median
Gross margin 100.00% 58.18% 77.13%
Operating margin 50.01% (1.21%) 0.34%
Net margin 21.54% (3.52%) 9.25%
Free cash flow margin 52.41% (94.31%) 13.03%
Return on equity 31.93% (5.67%) 8.49%
Return on assets 5.79% (0.77%) 2.29%
Return on invested capital 10.02% 0.00% 4.09%

Growth

Metric CACC KLAR Credit Services median
Revenue growth (TTM) 2.58% 34.19% 4.62%
EPS growth (last fiscal year) 83.60% (8,000.00%) —
Revenue growth, 5-year CAGR 6.78% — 9.13%
Net income growth, 5-year CAGR 0.14% — 0.00%

Health

Metric CACC KLAR Credit Services median
Debt to equity 3.96 0.00 0.68
Current ratio 14.89 1.08 1.55
Net debt to EBITDA 5.10 51.16 0.13

Dividend

Metric CACC KLAR Credit Services median
Dividend yield 5.02% — 3.34%
Payout ratio 0.00 — 0.00

Size

Metric CACC KLAR Credit Services median
Market cap 5.68b 4.86b 872.19m

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