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ARES COMMERCIAL REAL ESTATE (ACRE) Stock Fundamental Analysis

NYSE:ACRE - New York Stock Exchange, Inc. - US04013V1089 - REIT - Currency: USD

4.93  -0.07 (-1.4%)

After market: 4.93 0 (0%)

Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to ACRE. ACRE was compared to 65 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. While ACRE seems to be doing ok healthwise, there are quite some concerns on its profitability. ACRE is valued correctly, but it does not seem to be growing.


Dividend Valuation Growth Profitability Health

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2

1. Profitability

1.1 Basic Checks

ACRE had negative earnings in the past year.
In the past year ACRE had a positive cash flow from operations.
In multiple years ACRE reported negative net income over the last 5 years.
Each year in the past 5 years ACRE had a positive operating cash flow.
ACRE Yearly Net Income VS EBIT VS OCF VS FCFACRE Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M 200M

1.2 Ratios

The Return On Assets of ACRE (-0.88%) is worse than 76.92% of its industry peers.
ACRE's Return On Equity of -2.46% is on the low side compared to the rest of the industry. ACRE is outperformed by 76.92% of its industry peers.
Industry RankSector Rank
ROA -0.88%
ROE -2.46%
ROIC N/A
ROA(3y)-0.84%
ROA(5y)0.18%
ROE(3y)-2.9%
ROE(5y)0.96%
ROIC(3y)N/A
ROIC(5y)N/A
ACRE Yearly ROA, ROE, ROICACRE Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5 -5

1.3 Margins

ACRE has a better Gross Margin (34.37%) than 73.85% of its industry peers.
ACRE's Gross Margin has declined in the last couple of years.
The Profit Margin and Operating Margin are not available for ACRE so they could not be analyzed.
Industry RankSector Rank
OM N/A
PM (TTM) N/A
GM 34.37%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-16.69%
GM growth 5Y-7.42%
ACRE Yearly Profit, Operating, Gross MarginsACRE Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40

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6

2. Health

2.1 Basic Checks

ACRE does not have a ROIC to compare to the WACC, probably because it is not profitable.
Compared to 1 year ago, ACRE has more shares outstanding
ACRE has more shares outstanding than it did 5 years ago.
ACRE has a better debt/assets ratio than last year.
ACRE Yearly Shares OutstandingACRE Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10M 20M 30M 40M 50M
ACRE Yearly Total Debt VS Total AssetsACRE Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B 2B 2.5B

2.2 Solvency

ACRE has an Altman-Z score of 0.08. This is a bad value and indicates that ACRE is not financially healthy and even has some risk of bankruptcy.
ACRE has a better Altman-Z score (0.08) than 67.69% of its industry peers.
ACRE has a debt to FCF ratio of 29.70. This is a negative value and a sign of low solvency as ACRE would need 29.70 years to pay back of all of its debts.
ACRE has a Debt to FCF ratio of 29.70. This is in the better half of the industry: ACRE outperforms 80.00% of its industry peers.
ACRE has a Debt/Equity ratio of 1.74. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of ACRE (1.74) is better than 83.08% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.74
Debt/FCF 29.7
Altman-Z 0.08
ROIC/WACCN/A
WACC7.46%
ACRE Yearly LT Debt VS Equity VS FCFACRE Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 500M 1B 1.5B

2.3 Liquidity

A Current Ratio of 10.00 indicates that ACRE has no problem at all paying its short term obligations.
ACRE has a Current ratio of 10.00. This is amongst the best in the industry. ACRE outperforms 96.92% of its industry peers.
A Quick Ratio of 10.00 indicates that ACRE has no problem at all paying its short term obligations.
ACRE's Quick ratio of 10.00 is amongst the best of the industry. ACRE outperforms 96.92% of its industry peers.
Industry RankSector Rank
Current Ratio 10
Quick Ratio 10
ACRE Yearly Current Assets VS Current LiabilitesACRE Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M

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2

3. Growth

3.1 Past

ACRE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 69.88%, which is quite impressive.
The Revenue for ACRE has decreased by -19.61% in the past year. This is quite bad
Measured over the past years, ACRE shows a small growth in Revenue. The Revenue has been growing by 4.67% on average per year.
EPS 1Y (TTM)69.88%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%173.91%
Revenue 1Y (TTM)-19.61%
Revenue growth 3Y4.91%
Revenue growth 5Y4.67%
Sales Q2Q%-20.03%

3.2 Future

ACRE is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 46.52% yearly.
Based on estimates for the next years, ACRE will show a decrease in Revenue. The Revenue will decrease by -1.42% on average per year.
EPS Next Y133.22%
EPS Next 2Y57.69%
EPS Next 3Y46.52%
EPS Next 5YN/A
Revenue Next Year-17.41%
Revenue Next 2Y-12.55%
Revenue Next 3Y-1.42%
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.
ACRE Yearly Revenue VS EstimatesACRE Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 50M 100M 150M 200M
ACRE Yearly EPS VS EstimatesACRE Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0 0.5 -0.5 1 1.5

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4

4. Valuation

4.1 Price/Earnings Ratio

ACRE reported negative earnings for the last year, which makes the Price/Earnings Ratio negative.
With a Price/Forward Earnings ratio of 15.59, ACRE is valued correctly.
ACRE's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. ACRE is more expensive than 61.54% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.49. ACRE is valued slightly cheaper when compared to this.
Industry RankSector Rank
PE N/A
Fwd PE 15.59
ACRE Price Earnings VS Forward Price EarningsACRE Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 0 10 -10 20

4.2 Price Multiples

ACRE's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ACRE is cheaper than 73.85% of the companies in the same industry.
Industry RankSector Rank
P/FCF 8.53
EV/EBITDA N/A
ACRE Per share dataACRE EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 2 4 6 8

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ACRE's earnings are expected to grow with 46.52% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y57.69%
EPS Next 3Y46.52%

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4

5. Dividend

5.1 Amount

ACRE has a Yearly Dividend Yield of 12.00%, which is a nice return.
ACRE's Dividend Yield is comparable with the industry average which is at 11.56.
ACRE's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
Industry RankSector Rank
Dividend Yield 12%

5.2 History

The dividend of ACRE decreases each year by -3.33%.
ACRE has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-3.33%
Div Incr Years0
Div Non Decr Years0
ACRE Yearly Dividends per shareACRE Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.2 0.4 0.6 0.8 1

5.3 Sustainability

ACRE has negative earnings and hence a negative payout ratio. The dividend may be in danger.
DP-415.36%
EPS Next 2Y57.69%
EPS Next 3Y46.52%
ACRE Yearly Income VS Free CF VS DividendACRE Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M 200M

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ARES COMMERCIAL REAL ESTATE

NYSE:ACRE (6/27/2025, 8:04:00 PM)

After market: 4.93 0 (0%)

4.93

-0.07 (-1.4%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)05-07 2025-05-07/bmo
Earnings (Next)08-04 2025-08-04/bmo
Inst Owners44.9%
Inst Owner Change0.69%
Ins Owners5.61%
Ins Owner Change7.33%
Market Cap271.20M
Analysts48.33
Price Target5.1 (3.45%)
Short Float %3.54%
Short Ratio3.14
Dividend
Industry RankSector Rank
Dividend Yield 12%
Yearly Dividend1.1
Dividend Growth(5Y)-3.33%
DP-415.36%
Div Incr Years0
Div Non Decr Years0
Ex-Date06-30 2025-06-30 (0.15)
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)8.79%
Min Revenue beat(2)6.97%
Max Revenue beat(2)10.61%
Revenue beat(4)2
Avg Revenue beat(4)0.65%
Min Revenue beat(4)-12.52%
Max Revenue beat(4)10.61%
Revenue beat(8)3
Avg Revenue beat(8)-5.77%
Revenue beat(12)6
Avg Revenue beat(12)15.5%
Revenue beat(16)10
Avg Revenue beat(16)30.78%
PT rev (1m)6.67%
PT rev (3m)-13.98%
EPS NQ rev (1m)0%
EPS NQ rev (3m)312.53%
EPS NY rev (1m)1.76%
EPS NY rev (3m)384.92%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.68%
Revenue NY rev (1m)14.56%
Revenue NY rev (3m)0.46%
Valuation
Industry RankSector Rank
PE N/A
Fwd PE 15.59
P/S 1.68
P/FCF 8.53
P/OCF 8.43
P/B 0.5
P/tB 0.5
EV/EBITDA N/A
EPS(TTM)-0.25
EYN/A
EPS(NY)0.32
Fwd EY6.41%
FCF(TTM)0.58
FCFY11.73%
OCF(TTM)0.59
OCFY11.87%
SpS2.93
BVpS9.86
TBVpS9.86
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -0.88%
ROE -2.46%
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) N/A
GM 34.37%
FCFM 19.72%
ROA(3y)-0.84%
ROA(5y)0.18%
ROE(3y)-2.9%
ROE(5y)0.96%
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-16.69%
GM growth 5Y-7.42%
F-Score6
Asset Turnover0.11
Health
Industry RankSector Rank
Debt/Equity 1.74
Debt/FCF 29.7
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 10
Quick Ratio 10
Altman-Z 0.08
F-Score6
WACC7.46%
ROIC/WACCN/A
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)0.07%
Cap/Sales(5y)0.1%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)69.88%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%173.91%
EPS Next Y133.22%
EPS Next 2Y57.69%
EPS Next 3Y46.52%
EPS Next 5YN/A
Revenue 1Y (TTM)-19.61%
Revenue growth 3Y4.91%
Revenue growth 5Y4.67%
Sales Q2Q%-20.03%
Revenue Next Year-17.41%
Revenue Next 2Y-12.55%
Revenue Next 3Y-1.42%
Revenue Next 5YN/A
EBIT growth 1Y76%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year54.78%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-39.18%
FCF growth 3Y-10.02%
FCF growth 5Y2.7%
OCF growth 1Y-38.47%
OCF growth 3Y-9.77%
OCF growth 5Y1.81%