📊 ACRE Key Takeaways
Is Ares Commercial Real Estate Corp (ACRE) a Good Investment?
ACRE exhibits concerning profitability deterioration with negative operating and net margins despite strong 69% revenue growth, indicating the growth is not translating to earnings. The company's high leverage ratio (1.86x Debt/Equity) combined with negative returns on equity and assets raises questions about capital efficiency and financial sustainability.
Ares Commercial Real Estate Corp shows strong top-line growth and solid operating/free cash flow generation, which supports near-term balance sheet flexibility and portfolio cash earnings. However, the latest period still shows slightly negative operating and net income, very weak returns on assets and equity, and a highly leveraged capital structure, which limits the quality of the growth. Fundamentally, this looks stable but not strong enough to justify a bullish view until profitability becomes consistently positive.
Why Buy Ares Commercial Real Estate Corp Stock? ACRE Key Strengths
- Strong revenue growth of 69.1% year-over-year demonstrates market demand
- Positive operating cash flow of $21.4M and strong FCF margin of 38.8% indicate cash generation capability
- Manageable cash position of $29.3M with modest capital expenditure requirements
- Revenue grew 69.1% year over year, indicating a meaningful rebound in core income generation
- Operating cash flow of $21.35M and free cash flow of $21.26M suggest the business is still producing cash despite weak accounting earnings
- Equity of $509.57M provides a tangible capital base relative to $1.62B in total assets
ACRE Stock Risks: Ares Commercial Real Estate Corp Investment Risks
- Negative operating margin of -1.1% and net margin of -1.6% indicate unprofitable operations despite revenue growth
- High leverage with Debt/Equity ratio of 1.86x and long-term debt of $948.2M relative to $509.6M equity creates financial stress
- Negative ROE (-0.2%) and ROA (-0.1%) demonstrate poor capital efficiency and value destruction for shareholders
- EPS dilution concern despite positive EPS growth suggests equity issuance may be offsetting earnings gains
- Operating margin of -1.1% and net margin of -1.6% show the company is not currently converting revenue into accounting profit
- Debt/equity of 1.86x and long-term debt of $948.18M create elevated balance sheet risk for a commercial real estate lender
- Cash of $29.29M is modest relative to liabilities of $1.11B, reducing liquidity cushion if credit conditions worsen
Key Metrics to Watch
- Path to operating profitability - monitor if revenue growth translates to positive operating margins
- Debt reduction trajectory - track Long-term Debt levels relative to Operating Cash Flow for deleveraging progress
- Return on Equity trend - assess whether operational improvements drive ROE back to positive territory
- Net interest income and net income trend to confirm whether revenue growth is translating into durable profitability
- Leverage, liquidity, and non-accrual or impaired loan levels to assess balance sheet risk and credit quality
Ares Commercial Real Estate Corp (ACRE) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 38.8% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments. The current ratio below 1.0x warrants monitoring of short-term liquidity.
ACRE Profit Margin, ROE & Profitability Analysis
ACRE vs Real Estate Sector: How Ares Commercial Real Estate Corp Compares
How Ares Commercial Real Estate Corp compares to Real Estate sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Ares Commercial Real Estate Corp Stock Overvalued? ACRE Valuation Analysis 2026
Based on fundamental analysis, Ares Commercial Real Estate Corp shows some fundamental concerns relative to the Real Estate sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Ares Commercial Real Estate Corp Balance Sheet: ACRE Debt, Cash & Liquidity
ACRE Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Ares Commercial Real Estate Corp's revenue has remained relatively flat over the 5-year period, with a 9% decline. The most recent EPS of $-0.72 indicates the company is currently unprofitable.
ACRE Revenue Growth, EPS Growth & YoY Performance
ACRE Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $14.1M | $3.0M | $0.05 |
| Q2 2025 | $12.6M | -$1.7M | $-0.03 |
| Q1 2025 | $14.9M | -$5.9M | $0.17 |
| Q3 2024 | $16.7M | $546.0K | $0.01 |
| Q2 2024 | $16.8M | -$2.2M | $-0.04 |
| Q1 2024 | $18.7M | -$2.2M | $-0.12 |
| Q3 2023 | $23.9M | $546.0K | $0.01 |
| Q2 2023 | $25.0M | $644.0K | $-0.04 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Ares Commercial Real Estate Corp Dividends, Buybacks & Capital Allocation
ACRE SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Ares Commercial Real Estate Corp (CIK: 0001529377)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ACRE
What is the AI rating for ACRE?
Ares Commercial Real Estate Corp (ACRE) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 74% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ACRE's key strengths?
Claude: Strong revenue growth of 69.1% year-over-year demonstrates market demand. Positive operating cash flow of $21.4M and strong FCF margin of 38.8% indicate cash generation capability. ChatGPT: Revenue grew 69.1% year over year, indicating a meaningful rebound in core income generation. Operating cash flow of $21.35M and free cash flow of $21.26M suggest the business is still producing cash despite weak accounting earnings.
What are the risks of investing in ACRE?
Claude: Negative operating margin of -1.1% and net margin of -1.6% indicate unprofitable operations despite revenue growth. High leverage with Debt/Equity ratio of 1.86x and long-term debt of $948.2M relative to $509.6M equity creates financial stress. ChatGPT: Operating margin of -1.1% and net margin of -1.6% show the company is not currently converting revenue into accounting profit. Debt/equity of 1.86x and long-term debt of $948.18M create elevated balance sheet risk for a commercial real estate lender.
What is ACRE's revenue and growth?
Ares Commercial Real Estate Corp reported revenue of $54.8M.
Does ACRE pay dividends?
Ares Commercial Real Estate Corp pays dividends, with $39.0M distributed to shareholders in the trailing twelve months.
Where can I find ACRE SEC filings?
Official SEC filings for Ares Commercial Real Estate Corp (CIK: 0001529377) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ACRE's EPS?
Ares Commercial Real Estate Corp has a diluted EPS of $1.35.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is ACRE a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Ares Commercial Real Estate Corp has a SELL rating with 74% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is ACRE stock overvalued or undervalued?
Valuation metrics for ACRE: ROE of -0.2% (sector avg: 8%), net margin of -1.6% (sector avg: 20%). Compare these metrics with sector averages to assess valuation.
Should I buy ACRE stock in 2026?
Our dual AI analysis gives Ares Commercial Real Estate Corp a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is ACRE's free cash flow?
Ares Commercial Real Estate Corp's operating cash flow is $21.4M, with capital expenditures of $90.0K. FCF margin is 38.8%.
How does ACRE compare to other Real Estate stocks?
Vs Real Estate sector averages: Net margin -1.6% (avg: 20%), ROE -0.2% (avg: 8%), current ratio N/A (avg: 1.5).
Is Ares Commercial Real Estate Corp carrying too much debt?
ACRE has a debt-to-equity ratio of 1.86x, which is above the Real Estate sector average of 1.5x. Combined with a current ratio below 1, this warrants careful monitoring of the balance sheet.