Ares Commercial Real Estate Corporation (ACRE) Stock Grade

About Ares Commercial Real Estate Corporation's fundamentals

Ares Commercial Real Estate Corporation is a mortgage REIT with a market capitalization of $228.0 million that reported revenue growth of 22.5% year-over-year, though the company posted a net loss with a negative net margin of -1.1% in its latest annual statement. Despite the accounting loss, the company generated positive free cash flow, which supports its substantial dividend yield of 12.8%. The disconnect between accounting losses and positive cash generation is typical for mortgage REITs, which often distribute cash returns to shareholders while reporting non-cash charges that depress accounting profitability.