ACF AmeriCredit Corp?????

Discussion in 'Trading' started by ryanmitcho, Jan 28, 2003.

  1. ok- i know that i will catch some flak for talking about a crap stock like this on my first post here, but what is the general consensus on this dog?? I am sitting on a position of 6,000 shares and feel the sell-off was pretty vicious on their earnings miss- down 54% in one day alone!! so, my average price is 3.38 and today it goes to a high of 3.48, only to end the day (1/28/03) at 3.16, up a friggin' PENNY for the session. This company is so undervalued it is ridiculous, they have $200 million in cash, expect to earn 65-80cents in '03, low P/E and WILL make money this coming year.
    so why is it still under so much pressure/ can't rise 50cents???

    I have transferred this stock to my long term account so i don't have to watch my P/L fluctuate as much- I am holding it becuase i am pretty confident i will be able to sell it at my target of $5.50-7. the book value is much higher than my target and I think there will be a gradual recovery in the consumer credit industry and ACF will benefit. So, this play is strictly speculative with a stop loss of 2.45. I think it is a decent risk/reward play. What about everyone else?? Do you think that i see my target in a month or so or am I getting stopped out and this company is going to be a bad trade???

    Any owners of ACF shares??

    DISCLOSURE: 6,000 ACF long, 3.38 avg.
    bought 4,000 ACF long at 3.02, sold 3.35 = $1320
  2. AmeriCredit sees fiscal 2003 earnings of between $70 million and $80 million, or 45 cents to 51 cents a share, and income of $100 million to $125 million for the 12 months ending Dec. 31.

    Previously, the company had earnings projections of $80 million to $90 million for fiscal 2003 and $160 million to $170 million for the 12 months ending Dec. 31.

    Wall Street had estimated the company would earn 65 cents a share for fiscal 2003.


    PRICE: ACF closed on 01/24/2003 at $3.00 per share.

    VALUE: ACF has a Value of $8.6 per share. Value is the foundation of the VectorVest system. It is a measure of what a stock is currently worth. Value is based upon earnings, earnings growth rate, dividend payments, dividend growth rate, and financial performance. Current interest and inflation rates also play an important role in the computation of Value. When interest and/or inflation rates decrease, Value goes up. When interest rates and inflation increase, Value goes down. Sooner or later a stock's Price and Value always converge.

    RV (Relative Value): ACF has an RV of 1.48. On a scale of 0.00 to 2.00, an RV of 1.48 is excellent. RV reflects the long-term price appreciation potential of the stock compared to an alternative investment in AAA Corporate Bonds. Stocks with RV ratings above 1.00 have attractive upside potential. A stock will have an RV greater than 1.00 when its Value is greater than Price, and its Relative Safety (see below) and forecasted earnings growth rate are above average. In some cases, however, a stock's RV will be above 1.00 even though its Value is well below Price. This happens when a stock has an exemplary record of financial performance and an above average earnings growth rate. In this case, the stock is currently selling at a premium, and the investor is banking on future earnings growth to drive the stock's price higher. This information is very useful not only in knowing whether or not a stock has favorable price appreciation potential, but it also solves the riddle of whether to buy high growth, high P/E, or low growth, low P/E stocks. We believe that RV ratings above 1.00 are required to consistently achieve above average capital gains in the stock market.

    GRT (Growth Rate): ACF has a GRT of 16 % per year. This is very good. GRT stands for forecasted Earnings Growth Rate in percent per year. GRT is updated each week for every stock. Watch GRT trends very carefully. If the GRT trend is up, the stock's Price will likely rise. If the GRT trend is down, the stock's Price will increase more slowly, cease to increase, or subsequently fall.

    ACF has below average safety with well above average upside potential. It reflects a stock which is likely to give well above average, inconsistent returns over the long term.
  3. Yes, Im short it

    you see when a stok is going dwn I short it and when it goes up I buy it. Hence the market goes up I make money, the market goes down I make money. This is how to make money in the market.
  4. the only thing is buddy, you DON'T make money!!! that very brief ACF snynopsis I gave probably sounds like a foreign language to you!!

    ahhh- i see i have met one of the "resident jackasses" here on ET who have no real trading skills (and a negative P/L) and come to this site only to annoy other traders becuase they feel that in some way, it compensates for them losing money.

    don't waste my time by posting on my threads anymore mr "fillmycrackin"- PhilMcCracken- go trade your 100-lots
    :D :D :D
  5. Htrader

    Htrader Guest

    The street is concerned ACF could face a huge liquidity crisis in the future and thats the reason its down so much. Book value in this case is meaningless. While ACF may have 200 mil in cash, it has also over 2 billion in long term debt. Also with their loan default rate increasing, the concern is that they won't be able to generate positive cash flow, which would cause downgrades at credit agencies, which would cut them off from various debt markets and then its all over. Those earning estimates are also not reliable, the actual expected numbers are much lower. I'm not saying ACF can't recover. But its far from a sure thing. Very risky play.
  6. hey- thanks for your perspective- i know its not the most solid company out there, but I think that I can pull maybe two points out in a month as the market and the consumer credit industry gradually recover. However, thats what the stop is for- if it hits, I'll cover it, move on, make money elsewhere. I hate taking a loss, but I will- however, I think in terms of risk/reward, it is attractive and if my views should change, I will immediately exit. Do you really feel that ACF's coming year will be that challenging and the company will earn that much less/share than projected?? the numbers are adjusted, the bad news and earnings miss are factored into the price of the stock, shorts will be caught and forced to cover soon and as the market comes out of this oversold condition, ACF will give me at least 4.50- or I think I can at least get that.....

    GOOOOO ACF!!!!
  7. Tycoon


    You're in a very dangerous situation, my friend. I don't think you actually have a stop loss in place; and if you do, you'll just remove it when the stock starts hurtling towards your stop-out level because, let's face it: you don't have the heart to sell.

    How do I know that? A guy who says "GOOOOO ACF!!!!" has obviously allowed hope to supplant sound judgment. Good traders are most concerned with how much they could lose. Not you. You're wedded to this stock and can only imagine it vaulting higher. I'll bet that pumping up ACF helps you to assuage the doubts which are lingering in the back of your mind.

    My advice to you: Sell the stock and sell it now. Buy-and-hoping always ends in tears.

  8. cheeks


  9. i know that you mean well, but no, I am not "wedded" to this stock- i will probably sell on a break of $3- no need to lose too much. I am merely asking this board because you may know of OMG, a stock in a similar situation a while back that netted 4-5 points buying the extreme selloff. I saw that and decided to try ACF as a long term play. I am merely asking if others see this as a potential opportunity or not- why the hell not, right? ask someone else about a play that I don't normally do.
    I'm a statistical arb trader and that is my main and consistently profitable strategy- this is just playing around with an idea among other strategies/ systems I am exploring to trade in my sub-accounts. - I'm not going to ride it to 1.50, but I appreciate your feeble attempts to belittle me like I am some retail piker who is going to "lose my ass" on a $3 stock and never sell my losing position, lol. F#CK it, right, its a trade- either I'm right or I am wrong- I think it is decent risk reward. I analyze plays and make money. You seem to spend your time attacking others and in general, not being focused on making the green everyday.
    I will put my P/L up against yours anyday, buddy. Until then, save the tirade and the attacks for the chumps on this site that can really use it.
    GGGGGOOOOOOO ACF!!!!!!!!!!!!
    (just for you, tycoon)
  10. #10     Jan 28, 2003