ARES COMMERCIAL REAL ESTATE (ACRE)
US04013V1089 - REIT
ACRE gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 64 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. The financial health of ACRE is average, but there are quite some concerns on its profitability. ACRE does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year ACRE has reported negative net income.
In the past year ACRE had a positive cash flow from operations.
ACRE had positive earnings in 4 of the past 5 years.
In the past 5 years ACRE always reported a positive cash flow from operatings.
1.2 Ratios
ACRE's Return On Assets of -3.28% is on the low side compared to the rest of the industry. ACRE is outperformed by 96.88% of its industry peers.
ACRE has a worse Return On Equity (-11.31%) than 93.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.28% | ||
| ROE | -11.31% | ||
| ROIC | N/A |
ROA(3y)0.59%
ROA(5y)1%
ROE(3y)2.23%
ROE(5y)4%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Gross Margin, with a value of 31.98%, ACRE is in line with its industry, outperforming 56.25% of the companies in the same industry.
In the last couple of years the Gross Margin of ACRE has remained more or less at the same level.
The Profit Margin and Operating Margin are not available for ACRE so they could not be analyzed.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 31.98% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-9.75%
GM growth 5Y-0.33%
2. Health
2.1 Basic Checks
ACRE does not have a ROIC to compare to the WACC, probably because it is not profitable.
ACRE has less shares outstanding than it did 1 year ago.
ACRE has more shares outstanding than it did 5 years ago.
ACRE has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of -0.02, we must say that ACRE is in the distress zone and has some risk of bankruptcy.
ACRE's Altman-Z score of -0.02 is in line compared to the rest of the industry. ACRE outperforms 53.13% of its industry peers.
The Debt to FCF ratio of ACRE is 34.83, which is on the high side as it means it would take ACRE, 34.83 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 34.83, ACRE is doing good in the industry, outperforming 70.31% of the companies in the same industry.
A Debt/Equity ratio of 2.38 is on the high side and indicates that ACRE has dependencies on debt financing.
ACRE has a Debt to Equity ratio of 2.38. This is in the better half of the industry: ACRE outperforms 76.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.38 | ||
| Debt/FCF | 34.83 | ||
| Altman-Z | -0.02 |
ROIC/WACCN/A
WACC5.77%
2.3 Liquidity
ACRE has a Current Ratio of 3.84. This indicates that ACRE is financially healthy and has no problem in meeting its short term obligations.
ACRE's Current ratio of 3.84 is amongst the best of the industry. ACRE outperforms 90.63% of its industry peers.
A Quick Ratio of 3.84 indicates that ACRE has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 3.84, ACRE belongs to the top of the industry, outperforming 90.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.84 | ||
| Quick Ratio | 3.84 |
3. Growth
3.1 Past
The earnings per share for ACRE have decreased strongly by -2066.67% in the last year.
Looking at the last year, ACRE shows a very negative growth in Revenue. The Revenue has decreased by -11.69% in the last year.
ACRE shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.36% yearly.
EPS 1Y (TTM)-2066.67%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-164.71%
Revenue 1Y (TTM)-11.69%
Revenue growth 3Y14.6%
Revenue growth 5Y11.36%
Sales Q2Q%-30.27%
3.2 Future
The Earnings Per Share is expected to grow by 47.21% on average over the next years. This is a very strong growth
ACRE is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -9.83% yearly.
EPS Next Y40.5%
EPS Next 2Y51.37%
EPS Next 3Y47.21%
EPS Next 5YN/A
Revenue Next Year-30.25%
Revenue Next 2Y-17.81%
Revenue Next 3Y-9.83%
Revenue Next 5YN/A
3.3 Evolution
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings Ratio is negative for ACRE. In the last year negative earnings were reported.
The Price/Forward Earnings ratio is 29.45, which means the current valuation is very expensive for ACRE.
ACRE's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. ACRE is more expensive than 78.13% of the companies in the same industry.
ACRE's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 23.69.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 29.45 |
4.2 Price Multiples
Based on the Price/Free Cash Flow ratio, ACRE is valued a bit cheaper than 70.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.74 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
ACRE's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as ACRE's earnings are expected to grow with 47.21% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y51.37%
EPS Next 3Y47.21%
5. Dividend
5.1 Amount
ACRE has a Yearly Dividend Yield of 16.81%, which is a nice return.
ACRE's Dividend Yield is rather good when compared to the industry average which is at 13.28. ACRE pays more dividend than 93.75% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.33, ACRE pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 16.81% |
5.2 History
The dividend of ACRE has a limited annual growth rate of 4.58%.
ACRE has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)4.58%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
The earnings of ACRE are negative and hence is the payout ratio. ACRE will probably not be able to sustain this dividend level.
ACRE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP-100.23%
EPS Next 2Y51.37%
EPS Next 3Y47.21%
ARES COMMERCIAL REAL ESTATE
NYSE:ACRE (1/3/2025, 8:18:19 PM)
After market: 6.18 0 (0%)6.18
+0.23 (+3.87%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)
Earnings (Next)
Inst Owners45.53%
Inst Owner Change-1.26%
Ins Owners5.6%
Ins Owner Change7.76%
Market Cap337.06M
Analysts49.23
Price Target7.14 (15.53%)
Short Float %3.36%
Short Ratio3
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 16.81% |
Dividend Growth(5Y)4.58%
DP-100.23%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-266.68%
Min EPS beat(2)-343.49%
Max EPS beat(2)-189.87%
EPS beat(4)1
Avg EPS beat(4)-1360.14%
Min EPS beat(4)-4908.3%
Max EPS beat(4)1.1%
EPS beat(8)1
Avg EPS beat(8)-725.54%
EPS beat(12)2
Avg EPS beat(12)-494.71%
EPS beat(16)6
Avg EPS beat(16)-368.9%
Revenue beat(2)0
Avg Revenue beat(2)-7.49%
Min Revenue beat(2)-12.52%
Max Revenue beat(2)-2.46%
Revenue beat(4)1
Avg Revenue beat(4)-12.16%
Min Revenue beat(4)-40.95%
Max Revenue beat(4)7.29%
Revenue beat(8)2
Avg Revenue beat(8)1.99%
Revenue beat(12)6
Avg Revenue beat(12)27.37%
Revenue beat(16)10
Avg Revenue beat(16)39.46%
PT rev (1m)0%
PT rev (3m)1.82%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-50.15%
EPS NY rev (1m)-11.5%
EPS NY rev (3m)-242.86%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-12.81%
Revenue NY rev (1m)-0.82%
Revenue NY rev (3m)1.38%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 29.45 | ||
| P/S | 1.84 | ||
| P/FCF | 8.74 | ||
| P/OCF | 8.74 | ||
| P/B | 0.6 | ||
| P/tB | 0.6 | ||
| EV/EBITDA | N/A |
EPS(TTM)-1.18
EYN/A
EPS(NY)0.21
Fwd EY3.4%
FCF(TTM)0.71
FCFY11.44%
OCF(TTM)0.71
OCFY11.44%
SpS3.36
BVpS10.34
TBVpS10.34
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.28% | ||
| ROE | -11.31% | ||
| ROCE | N/A | ||
| ROIC | N/A | ||
| ROICexc | N/A | ||
| ROICexgc | N/A | ||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 31.98% | ||
| FCFM | 21.03% |
ROA(3y)0.59%
ROA(5y)1%
ROE(3y)2.23%
ROE(5y)4%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-9.75%
GM growth 5Y-0.33%
F-Score5
Asset Turnover0.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.38 | ||
| Debt/FCF | 34.83 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | N/A | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 3.84 | ||
| Quick Ratio | 3.84 | ||
| Altman-Z | -0.02 |
F-Score5
WACC5.77%
ROIC/WACCN/A
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)0.02%
Cap/Sales(5y)0.3%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-2066.67%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-164.71%
EPS Next Y40.5%
EPS Next 2Y51.37%
EPS Next 3Y47.21%
EPS Next 5YN/A
Revenue 1Y (TTM)-11.69%
Revenue growth 3Y14.6%
Revenue growth 5Y11.36%
Sales Q2Q%-30.27%
Revenue Next Year-30.25%
Revenue Next 2Y-17.81%
Revenue Next 3Y-9.83%
Revenue Next 5YN/A
EBIT growth 1Y-1793.08%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year-6.33%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-35.94%
FCF growth 3Y14.1%
FCF growth 5Y3.6%
OCF growth 1Y-35.94%
OCF growth 3Y13.74%
OCF growth 5Y3.6%