Stock fact sheet · data as of
Ares Commercial Real Estate Corporation (ACRE): fair value, margin of safety and Wheel Score
Real Estate · REIT - Mortgage · United States · Speculative / Distressed
Is ACRE undervalued?
Ares Commercial Real Estate Corporation (ACRE) closed at 3.58 on 16 Oct 2026. The GLS average fair value - the simple average of the 2 valuation models that produced a positive number - is 6.97, which puts the price 49% below it. 2 of the 2 models value the shares above the current price. A gap this wide is rare in our universe of ~7,400 US stocks and is exactly what the Value part of the Wheel Score rewards; it is also where the question "why is it this cheap?" matters most.
The average is built from just 2 models (10 Cap, DDM) - the rest returned nothing because an input they need (dividends, free cash flow, book value) is zero or negative - so treat it with more caution than usual.
The nightly engine files ACRE under Speculative / Distressed - negative earnings or a Piotroski score of 3 or less - which caps its Wheel Score at 45 and keeps it out of the Sunday Scan.
Nine valuation models for ACRE
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | - | - | Present value of the projected free cash flows, discounted at the cost of capital; no value tonight |
| Graham Number | - | - | The most a defensive investor pays for the earnings and book value per share; no value tonight |
| Graham Growth | - | - | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields; no value tonight |
| Lynch | - | - | EPS × the earnings growth rate (PEG of 1), growth capped at 25%; no value tonight |
| GLS Growth | - | - | EPS compounded ten years at the blended growth rate, discounted back at 15% a year; no value tonight |
| 10 Cap | 5.11 | +43% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | - | - | Eight years of compounded free cash flow: the price at which the business pays for itself; no value tonight |
| DDM | 8.83 | +147% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | - | - | Earnings power value: current EPS capitalised at 9% with no growth; no value tonight |
| Zombie (liquidation) | -18.77 | -624% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 5.50 | +54% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Ares Commercial Real Estate Corporation scores only 4 of 9 on the Piotroski F-score, which fails the Sunday Scan's "6 or more" rule. A reading this low means several of the basic tests - positive earnings, positive operating cash flow, falling debt, no new share issuance - are not met. A GLS Moat score of 2.1/10 is a weak reading: the ten-year history the score grades (revenue, EPS, book value, margins, cash flow, share count, ROIC) has not been steady, so the Moat part of the Wheel Score contributes little.
Returns on capital are thin or negative - ROIC -0.1%, ROE -0.2%, ROA -0.1% - with debt at 2.06 times equity and a free-cash-flow yield of 6.7%. Debt of 2.06 times equity is on the high side for the sector and is worth checking against the cash flow before treating the stock as a long-term hold.
The dividend yield is high at 16.76% (payout ratio -758%). A yield this size is often the market's way of pricing a risk to the payout, so the health score and cash flow matter more than usual. Revenue comes mainly from Reportable 100% (quarter Q2 FY2026).
Institutional ownership scores 6/10, insider activity 1/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 4 / 9 | ROIC | -0.1% |
|---|---|---|---|
| GLS Moat | 2.1 / 10 | ROE | -0.2% |
| Debt / equity | 2.06 | ROA | -0.1% |
| Free-cash-flow yield | 6.7% | Payout ratio | -758% |
| Institutions | 6 / 10 | Insiders · Congress | 1 · 5 / 10 |
Wheel Score 45: Weak
With a Wheel Score of 45 Ares Commercial Real Estate Corporation sits in the Weak band, capped at 45 because the engine files it as Speculative / Distressed. The parts - Value 25/25, Health 9/20, Moat 3/15, Premium 19/20, Stability 11/20 - show where: Moat (3/15) scores lowest.
Implied volatility is 64% on the near-the-money contracts 20-60 days out - above the 60% ceiling of the sweet spot. Premiums are large, but the Wheel Score tapers the Premium points (19 of 20) because volatility this high usually comes with a reason. Chain open interest is thin - 1,796 contracts across every expiry - so fills at a fair price are not guaranteed; a 30-45-day put may not exist at a usable strike.
Volume runs at 757k shares a day on a market cap of $199M, with a beta of 1.25 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 11 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 25 / 25 | 49% margin of safety | |
| Health | 9 / 20 | Piotroski 4/9 | |
| Moat | 3 / 15 | moat 2.1/10 | |
| Premium | 19 / 20 | implied volatility 64% | |
| Stability | 11 / 20 | 757k shares/day, $199M cap, beta 1.25 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 6 Nov 2026 (before the open), 21 days away; a 30-45-day put sold today would expire after it, which is worth weighing against the premium.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in REIT - Mortgage
The 12 companies below are the closest to Ares Commercial Real Estate Corporation by market cap within the REIT - Mortgage industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| AOMR Angel Oak Mortgage, Inc. | 7.22 | 17.88 | +60% | 39No options | $180M |
| RCD Ready Capital Corporation Notes -15.12.29 | 21.29 | 9.60 | -122% | 17No options | $177M |
| RC Ready Capital Corporation | 1.07 | 44.42 | +98% | 45Weak | $177M |
| MITT TPG Mortgage Investment Trust Inc | 5.54 | 203.75 | +97% | 72Good | $176M |
| MITP TPG Mortgage Investment Trust Inc 9.500% Senior Notes due 2029 | 25.05 | 247.43 | +90% | 39No options | $176M |
| REFI Chicago Atlantic Real Estate Finance, Inc. | 9.14 | 20.63 | +56% | 73Good | $234M |
| CMTG Claros Mortgage Trust, Inc. | 1.18 | - | - | 39Weak | $166M |
| NREF NexPoint Real Estate Finance, Inc. | 15.33 | 67.95 | +77% | 64Fair | $289M |
| SEVN Seven Hills Realty Trust | 6.78 | 20.74 | +67% | 68Good | $129M |
| KREF KKR Real Estate Finance Trust Inc. | 5.97 | 46.66 | +87% | 45Weak | $352M |
| RWT Redwood Trust, Inc. | 2.95 | 2.77 | -6% | 58Fair | $371M |
| RWTS Redwood Trust, Inc. 9.75% Senior Notes Due 2031 | 19.22 | 3.97 | -384% | 6No options | $96M |
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Start free See the Sunday ScanQuestions about ACRE
Is ACRE undervalued right now?
By the GLS models, yes: at 3.58 the stock is 49% below the average fair value of 6.97 (data as of 16 Oct 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of ACRE and what does it mean?
ACRE scores 45 out of 100 (Weak). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for ACRE?
6.97 per share as of 16 Oct 2026 - the simple average of the 2 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Ares Commercial Real Estate Corporation report earnings next?
The next earnings report is due on 6 Nov 2026 (before the open), 21 days from the data date of 16 Oct 2026. The Calendars page lists every upcoming report with its time of day.
Does ACRE have listed options, and how liquid are they?
Yes. The nightly snapshot found 30 listed contracts with 1,796 open interest across all expiries and implied volatility of 64% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.