Ares Commercial Real Estate

Dividend Yield: 7.40%

Ares Commercial Real Estate (NYSE: ACRE) shares currently have a dividend yield of 7.40%.

Ares Commercial Real Estate Corporation, a specialty finance company, operates as a real estate investment trust (REIT). It originates, invests in, and manages middle-market commercial real estate (CRE) loans and other commercial real estate investments. The company has a P/E ratio of 71.37.

The average volume for Ares Commercial Real Estate has been 90,500 shares per day over the past 30 days. Ares Commercial Real Estate has a market cap of $125.7 million and is part of the real estate industry. Shares are down 20.3% year to date as of the close of trading on Friday.

TheStreet Ratings rates Ares Commercial Real Estate as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and unimpressive growth in net income.

Highlights from the ratings report include:
  • The share price of ARES COMMERCIAL REAL ESTATE has not done very well: it is down 23.09% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 35.6% when compared to the same quarter one year ago, falling from $0.51 million to $0.33 million.
  • ARES COMMERCIAL REAL ESTATE's earnings per share declined by 33.3% in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($0.72 versus $0.10).
  • The gross profit margin for ARES COMMERCIAL REAL ESTATE is rather high; currently it is at 54.60%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, ACRE's net profit margin of 4.87% is significantly lower than the industry average.
  • Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market on the basis of return on equity, ARES COMMERCIAL REAL ESTATE underperformed against that of the industry average and is significantly less than that of the S&P 500.

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Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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