Ares Commercial Real Estate Corporation Common Stock (ACRE)

FairStock Score: 65/100 — STEADY

Key Financials

Strengths

• Revenue growth of 3359.6% demonstrates strong top-line momentum
• Attractive 12.7% dividend yield providing steady income returns

Concerns

• High leverage at 2.58x debt-to-equity increases financial risk and interest expense burden
• Currently unprofitable—sustained losses could lead to dilutive capital raises or balance sheet deterioration
• Weak Piotroski F-Score of 3/9 suggests deteriorating financial quality across multiple dimensions
• Altman Z-Score of -0.1 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Ares Commercial Real Estate Corporation Common Stock is a micro-cap real estate company valued at $286 million. Revenue stands at $55 million, though the company is currently unprofitable. From a quality standpoint, Ares shows weak Piotroski F-Score of 3/9 signaling deteriorating fundamentals and distressed Altman Z-Score of -0.1 warrants caution. On valuation, the stock is 1.5% FCF yield. Growth dynamics show revenue growing at 3359.6% and profit growth of 63.8%. The 12.7% dividend yield adds an income component for patient holders. Our composite FairStock Score of 65/100 reflects above-average fundamentals overall. Without profitability, this remains speculative—suitable only for those with high risk tolerance and a long time horizon.

Bull Case

Ares's 3360% revenue growth trajectory could accelerate as it captures additional market share in the real estate sector. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Without a clear path to profitability, continued cash burn forces either dilutive equity raises or debt accumulation that destroys shareholder value. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer