Ares Commercial (ACRE) Q4 2025 Earnings Transcript
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5 days ago
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Should l Buy ACRE?
Source: NASDAQ.COM
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Analyst Views on ACRE
Wall Street analysts forecast ACRE stock price to fall
5 Analyst Rating
1 Buy
2 Hold
2 Sell
Hold
Current: 5.280
Low
4.00
Averages
4.83
High
5.50
Current: 5.280
Low
4.00
Averages
4.83
High
5.50
About ACRE
Ares Commercial Real Estate Corporation is a specialty finance company primarily engaged in directly originating and investing in commercial real estate loans and related investments. The Company, through its national direct origination platform, provides a broad offering of flexible and reliable financing solutions for commercial real estate owners and operators. The Company originates senior mortgage loans, as well as subordinate financings, mezzanine debt and preferred equity, with an emphasis on providing value added financing on a variety of properties located in liquid markets across the United States. Senior mortgage loans are typically secured by first liens on commercial properties, including property types, such as office, multifamily, self storage, retail, hotel, healthcare, student housing, industrial, mixed-use, residential and residential condominium. The Company is externally managed by Ares Commercial Real Estate Management LLC.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Ares Commercial Real Estate Q4 2025 Earnings Call Insights
- Asset Restructuring Progress: Ares Commercial Real Estate Corporation successfully closed 13 new loan commitments totaling $486 million in Q4 2025, demonstrating the company's proactive efforts in asset restructuring and reducing risk-rated loans, particularly with a 30% reduction in office loans to $447 million, reflecting its commitment to navigating market challenges.
- Financial Performance Overview: Despite reporting a GAAP net loss of $1 million or $0.02 per diluted share for the full year 2025, the company achieved distributable earnings of $8 million or $0.15 per diluted share in Q4, indicating potential for recovery in profitability, with management expressing optimism about future earnings growth.
- Dividend Confidence Maintained: The board declared a regular cash dividend of $0.15 per common share for Q1 2026, with management believing that the execution of their business plan will pave the way for future earnings growth, despite not providing explicit guidance on earnings or revenue, showcasing confidence in sustaining dividends.
- Risk Loan Management: The CEO emphasized the company's focus on resolving remaining risk-rated 4 and 5 loans, particularly the $140 million Chicago office loan, which, despite challenges, has over 90% occupancy and stable fundamentals, providing potential for future asset disposition.
See More
Ares Commercial (ACRE) Q4 2025 Earnings Transcript
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Ares Commercial Real Estate Declares Quarterly Dividend
- Quarterly Dividend Announcement: Ares Commercial Real Estate has declared a quarterly dividend of $0.15 per share, consistent with previous distributions, demonstrating the company's ongoing ability to maintain stable cash flows and bolster investor confidence.
- Yield Performance: The forward yield of 11.74% indicates that the company can still provide attractive returns in the current market environment, potentially drawing in more income-focused investors.
- Shareholder Record Date: The dividend will be payable on April 15, with a record date of March 31 and an ex-dividend date also on March 31, ensuring shareholders receive their dividends promptly and further solidifying the shareholder base.
- Market Reaction Expectations: Following the dividend announcement, market interest in Ares Commercial Real Estate may increase, especially against the backdrop of the company's reduced exposure to office properties, prompting investors to reassess their portfolios.
See More
Ares Commercial Real Estate Q4 Earnings Highlights
- Earnings Performance: Ares Commercial Real Estate reported a Q4 non-GAAP EPS of $0.15, which, despite a year-over-year decline, exceeded market expectations by $1.4 million, indicating resilience in profitability.
- Revenue Decline: The company’s Q4 revenue stood at $13.21 million, reflecting a 24.6% year-over-year decrease, which highlights challenges in the market environment that could impact future investment decisions and shareholder confidence.
- Loan Growth: Ares Commercial Real Estate achieved growth in new loans even while reducing exposure to office properties, demonstrating the company's flexibility in adjusting its asset portfolio to respond to market changes.
- Uncertain Market Outlook: Despite growth in loans, the market outlook for the company remains unclear, which may influence investor decision-making moving forward.
See More
Ares Commercial Real Estate to Announce Q4 Earnings on February 10
- Earnings Announcement: Ares Commercial Real Estate is set to release its Q4 earnings on February 10 before market open, with a consensus EPS estimate of -$0.03, reflecting an 80% year-over-year improvement, indicating resilience amid challenges.
- Revenue Decline Expected: The anticipated revenue for Q4 is $11.38 million, representing a 35% year-over-year decline, which highlights the challenges the company faces in the current economic environment and may impact investor confidence.
- Historical Performance Review: Over the past two years, ACRE has beaten EPS estimates 38% of the time and revenue estimates 25% of the time, indicating uncertainty in the company's financial performance.
- Estimate Revision Dynamics: In the last three months, EPS estimates have seen three upward revisions and one downward revision, while revenue estimates have experienced one upward and one downward revision, suggesting differing analyst views on the company's future performance.
See More
Ares Commercial Real Estate Announces 2025 Tax Treatment for Distributions
- Distribution Overview: Ares Commercial Real Estate Corporation announced the tax treatment for its common stock distributions in 2025, with a total cash distribution of $0.7000 per share, including $0.2500 allocable to 2025 and $0.1500 to 2026, indicating the company's stable cash flow and commitment to dividends.
- Distribution Details: The cash distributions for 2025 are set at $0.2500 for the record date of December 31, and $0.1500 for March 31, June 30, and September 30, which will enhance shareholder returns and reflect the company's dedication to its investors.
- Tax Advisory: The company encourages shareholders to consult their tax advisors regarding the specific tax treatment of the distributions, demonstrating its commitment to transparency and compliance, aimed at assisting shareholders in optimizing their tax planning.
- Company Background: Ares Commercial Real Estate Corporation specializes in originating and investing in commercial real estate loans, and as a real estate investment trust managed externally by a subsidiary of Ares Management Corporation, it showcases its expertise and stability in the market.
See More
Ares Commercial Real Estate Q4 2025 Earnings Call Insights
- Asset Restructuring Progress: Ares Commercial Real Estate Corporation successfully closed 13 new loan commitments totaling $486 million in Q4 2025, demonstrating the company's proactive efforts in asset restructuring and reducing risk-rated loans, particularly with a 30% reduction in office loans to $447 million, reflecting its commitment to navigating market challenges.
- Financial Performance Overview: Despite reporting a GAAP net loss of $1 million or $0.02 per diluted share for the full year 2025, the company achieved distributable earnings of $8 million or $0.15 per diluted share in Q4, indicating potential for recovery in profitability, with management expressing optimism about future earnings growth.
- Dividend Confidence Maintained: The board declared a regular cash dividend of $0.15 per common share for Q1 2026, with management believing that the execution of their business plan will pave the way for future earnings growth, despite not providing explicit guidance on earnings or revenue, showcasing confidence in sustaining dividends.
- Risk Loan Management: The CEO emphasized the company's focus on resolving remaining risk-rated 4 and 5 loans, particularly the $140 million Chicago office loan, which, despite challenges, has over 90% occupancy and stable fundamentals, providing potential for future asset disposition.
See More
Ares Commercial (ACRE) Q4 2025 Earnings Transcript
See More
Ares Commercial Real Estate Declares Quarterly Dividend
- Quarterly Dividend Announcement: Ares Commercial Real Estate has declared a quarterly dividend of $0.15 per share, consistent with previous distributions, demonstrating the company's ongoing ability to maintain stable cash flows and bolster investor confidence.
- Yield Performance: The forward yield of 11.74% indicates that the company can still provide attractive returns in the current market environment, potentially drawing in more income-focused investors.
- Shareholder Record Date: The dividend will be payable on April 15, with a record date of March 31 and an ex-dividend date also on March 31, ensuring shareholders receive their dividends promptly and further solidifying the shareholder base.
- Market Reaction Expectations: Following the dividend announcement, market interest in Ares Commercial Real Estate may increase, especially against the backdrop of the company's reduced exposure to office properties, prompting investors to reassess their portfolios.
See More
Ares Commercial Real Estate Q4 Earnings Highlights
- Earnings Performance: Ares Commercial Real Estate reported a Q4 non-GAAP EPS of $0.15, which, despite a year-over-year decline, exceeded market expectations by $1.4 million, indicating resilience in profitability.
- Revenue Decline: The company’s Q4 revenue stood at $13.21 million, reflecting a 24.6% year-over-year decrease, which highlights challenges in the market environment that could impact future investment decisions and shareholder confidence.
- Loan Growth: Ares Commercial Real Estate achieved growth in new loans even while reducing exposure to office properties, demonstrating the company's flexibility in adjusting its asset portfolio to respond to market changes.
- Uncertain Market Outlook: Despite growth in loans, the market outlook for the company remains unclear, which may influence investor decision-making moving forward.
See More
Ares Commercial Real Estate to Announce Q4 Earnings on February 10
- Earnings Announcement: Ares Commercial Real Estate is set to release its Q4 earnings on February 10 before market open, with a consensus EPS estimate of -$0.03, reflecting an 80% year-over-year improvement, indicating resilience amid challenges.
- Revenue Decline Expected: The anticipated revenue for Q4 is $11.38 million, representing a 35% year-over-year decline, which highlights the challenges the company faces in the current economic environment and may impact investor confidence.
- Historical Performance Review: Over the past two years, ACRE has beaten EPS estimates 38% of the time and revenue estimates 25% of the time, indicating uncertainty in the company's financial performance.
- Estimate Revision Dynamics: In the last three months, EPS estimates have seen three upward revisions and one downward revision, while revenue estimates have experienced one upward and one downward revision, suggesting differing analyst views on the company's future performance.
See More
Ares Commercial Real Estate Announces 2025 Tax Treatment for Distributions
- Distribution Overview: Ares Commercial Real Estate Corporation announced the tax treatment for its common stock distributions in 2025, with a total cash distribution of $0.7000 per share, including $0.2500 allocable to 2025 and $0.1500 to 2026, indicating the company's stable cash flow and commitment to dividends.
- Distribution Details: The cash distributions for 2025 are set at $0.2500 for the record date of December 31, and $0.1500 for March 31, June 30, and September 30, which will enhance shareholder returns and reflect the company's dedication to its investors.
- Tax Advisory: The company encourages shareholders to consult their tax advisors regarding the specific tax treatment of the distributions, demonstrating its commitment to transparency and compliance, aimed at assisting shareholders in optimizing their tax planning.
- Company Background: Ares Commercial Real Estate Corporation specializes in originating and investing in commercial real estate loans, and as a real estate investment trust managed externally by a subsidiary of Ares Management Corporation, it showcases its expertise and stability in the market.
See More
