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AmeriCredit Corp. Jun 04
Standard & Poors, June 2004
Abstract
Strong capital base and deleveraged balance sheet Strong franchise Improved liquidity Monoline subprime automobile lender Dependence on ABS as funding Encumbered balance sheet The ratings on AmeriCredit Corp. reflect the company's significant capital base and develeraged balance sheet, its strong franchise, and improved liquidity position. AmeriCredit's strong capital base, in excess of $2 billion, which has been built up through a combination of earnings retention and stock issuance, provides a significant cushion given the high level of charge-offs inherent in its subprime automobile business model. Going forward, internal capital generation will be strong as the company increases originations to $1 billion per quarter and then pursues a reasonable 10%-15% per year growth strategy. This will have the effect of further...
Companies mentioned in this report are: General Motors Financial Co. Inc.
Action: Review
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Full Analysis
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