Ares Commercial Real Estate (NYSE:ACRE) Releases Earnings Results, Beats Expectations By $0.08 EPS

Key Points

• Ares Commercial Real Estate beat quarterly expectations: The REIT reported earnings per share of $0.12 versus the $0.04 consensus estimate, while revenue reached $14.36 million, above expectations of $10.96 million. However, it posted a negative net margin of 37.21% and negative return on equity of 2.80%.
• The stock rose to $4.71 and remains near the lower end of its 52-week range of $4.05 to $5.89. Ares also paid a quarterly dividend of $0.15, equivalent to a 12.7% annualized yield.
• Analyst sentiment remains cautious: The stock has a consensus rating of “Reduce,” with one Buy, four Hold and two Sell ratings, and an average price target of $5.25. Institutional investors and hedge funds own approximately 41.34% of the shares.

Ares Commercial Real Estate (NYSE:ACRE - Get Free Report) released its quarterly earnings results on Monday. The real estate investment trust reported $0.12 earnings per share for the quarter, beating analysts' consensus estimates of $0.04 by $0.08, FiscalAI reports. The business had revenue of $14.36 million for the quarter, compared to analysts' expectations of $10.96 million. Ares Commercial Real Estate had a negative net margin of 37.21% and a negative return on equity of 2.80%.

Ares Commercial Real Estate Stock Performance

ACRE stock traded up $0.47 during midday trading on Tuesday, reaching $4.71. The stock had a trading volume of 416,456 shares, compared to its average volume of 470,736. The firm has a fifty day simple moving average of $4.64 and a two-hundred day simple moving average of $4.90. Ares Commercial Real Estate has a 52-week low of $4.05 and a 52-week high of $5.89. The stock has a market cap of $261.59 million, a PE ratio of -13.07 and a beta of 1.15.

Ares Commercial Real Estate Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Wednesday, July 15th. Investors of record on Tuesday, June 30th were paid a $0.15 dividend. The ex-dividend date was Tuesday, June 30th. This represents a $0.60 dividend on an annualized basis and a yield of 12.7%. Ares Commercial Real Estate's dividend payout ratio (DPR) is -166.67%.

Analyst Upgrades and Downgrades

Several research analysts recently weighed in on ACRE shares. Citizens Jmp restated a "market perform" rating on shares of Ares Commercial Real Estate in a research note on Thursday, July 9th. Zacks Research upgraded Ares Commercial Real Estate from a "strong sell" rating to a "hold" rating in a research note on Friday, July 10th. Keefe, Bruyette & Woods lowered their price target on Ares Commercial Real Estate from $6.00 to $5.50 and set an "outperform" rating for the company in a report on Wednesday, May 13th. JPMorgan Chase & Co. dropped their price target on Ares Commercial Real Estate from $5.50 to $5.00 and set a "neutral" rating on the stock in a research note on Friday, July 17th. Finally, UBS Group initiated coverage on shares of Ares Commercial Real Estate in a report on Tuesday, June 2nd. They set a "neutral" rating and a $5.50 price objective on the stock. One research analyst has rated the stock with a Buy rating, four have given a Hold rating and two have issued a Sell rating to the company. Based on data from MarketBeat, the stock presently has an average rating of "Reduce" and a consensus price target of $5.25.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the business. Russell Investments Group Ltd. boosted its holdings in Ares Commercial Real Estate by 456.0% in the 3rd quarter. Russell Investments Group Ltd. now owns 6,033 shares of the real estate investment trust's stock worth $27,000 after buying an additional 4,948 shares during the last quarter. Triumph Capital Management purchased a new stake in Ares Commercial Real Estate in the 3rd quarter valued at $38,000. Strs Ohio acquired a new position in shares of Ares Commercial Real Estate during the 1st quarter valued at about $47,000. BNP Paribas Financial Markets grew its holdings in shares of Ares Commercial Real Estate by 100.3% in the third quarter. BNP Paribas Financial Markets now owns 10,367 shares of the real estate investment trust's stock valued at $47,000 after purchasing an additional 5,192 shares during the period. Finally, Brooklyn Investment Group increased its position in Ares Commercial Real Estate by 210.0% during the third quarter. Brooklyn Investment Group now owns 10,955 shares of the real estate investment trust's stock worth $49,000 after purchasing an additional 7,421 shares during the last quarter. 41.34% of the stock is currently owned by institutional investors and hedge funds.

Ares Commercial Real Estate Company Profile

Ares Commercial Real Estate Corporation NYSE: ACRE is a publicly traded real estate investment trust (REIT) primarily focused on commercial real estate debt investments. Externally managed by an affiliate of Ares Management Corporation, ACRE seeks to generate attractive risk-adjusted returns through its diversified portfolio of CRE financing strategies. The company specializes in originating, acquiring, financing and managing first mortgages, mezzanine loans, preferred equity and other structured finance products.

Since its inception, Ares Commercial Real Estate has targeted a broad range of property types, including multifamily, office, industrial, retail and hospitality assets.

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