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Acres Commercial Realty Corp. (ACR)
:ACR
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ACRES Commercial Realty
(NYSE:ACR)
68Neutral
Positive Factors
Financial Performance
The book value of ACRES Commercial Realty Corp. increased to $28.87 per share, showing growth in the company's value.
Share Repurchase
The company repurchased 155K shares of its common stock, which increased book value per share, indicating a strategy to enhance shareholder value.
Negative Factors
Loan Portfolio
The middle-market CRE loan portfolio decreased by 5.9%, which might be a concern for future growth prospects.
ACRES Commercial Realty (ACR) vs. S&P 500 (SPY)
Market Cap
$177.18M
Dividend YieldN/A
Average Volume (3M)40.91K
Price to Earnings (P/E)19.8
Beta (1Y)0.37
Revenue Growth-3.46%
EPS GrowthN/A
CountryUS
EmployeesN/A
SectorReal Estate
Sector Strength72
IndustryREITs
Share Statistics
EPS (TTM)1.16
Shares Outstanding7,736,907
10 Day Avg. Volume56,815
30 Day Avg. Volume40,905
Financial Highlights & Ratios
PEG Ratio0.08
Price to Book (P/B)N/A
Price to Sales (P/S)3.93
Price to Cash Flow (P/CF)5.30
P/FCF Ratio5.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$22.00Price Target Upside-3.93% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering1
ACRES Commercial Realty Business Overview & Revenue Model
Company DescriptionExantas Capital Corp. is a real estate investment trust, which engages in the provision of real estate finance services. It focuses on the origination, holding, and management of commercial mortgage loans, and commercial real estate-related debt investments. The company was founded in 2005 and is headquartered in New York, NY.
How the Company Makes MoneyACRES Commercial Realty generates revenue primarily through the interest income derived from its portfolio of commercial real estate loans. The company issues these loans to property owners and developers, who use the funds for purchasing, developing, or refinancing commercial properties. Additionally, ACR may earn money through origination fees charged for new loans and management fees for servicing its loan portfolio. The company's earnings are also influenced by its ability to effectively manage credit risk, interest rate fluctuations, and maintain a diversified portfolio that balances risk and return. Partnerships with financial institutions and other investors may also play a role in providing capital or co-investment opportunities, enhancing ACR's capacity to fund large-scale commercial real estate projects.
ACRES Commercial Realty Financial Statement Overview
Summary
ACRES Commercial Realty exhibits strong profitability and revenue growth, with a high gross profit margin and significant revenue increase. Despite these positive indicators, the high debt-to-equity ratio signals potential risk, which slightly tempers the strong performance in income and cash flow statements.Income Statement
ACRES Commercial Realty shows positive growth in its income statement metrics. The TTM (Trailing-Twelve-Months) gross profit margin stands at an impressive 88.4%, indicating strong profitability from its operations. The net profit margin for the TTM is 17.5%, which is a significant improvement from previous periods, showcasing effective cost management and profitability. Revenue growth has been robust, with a 87.7% increase from 2023 to 2024, reflecting successful market expansion or increased demand. EBIT margin (66.2%) and EBITDA margin (45.2%) are healthy, indicating efficient operations. Overall, the income statement reflects strong profitability and growth trends, albeit with potential volatility in revenue streams.76
Positive
Balance Sheet
The balance sheet analysis shows a moderate financial position. The debt-to-equity ratio is high at 3.52, suggesting significant leverage, which can be a risk if not managed properly. Return on Equity (ROE) is 6.0% for the TTM, indicating modest returns for shareholders. The equity ratio is 21.7%, reflecting a smaller equity base relative to total assets. While the company has a substantial debt load, it maintains a stable equity position. Overall, the balance sheet suggests moderate strength with high leverage, which could pose risks in adverse market conditions.65
Positive
Cash Flow
The cash flow statement shows positive trends, with a stable free cash flow of $28 million in the TTM. The operating cash flow to net income ratio is 1.07, indicating solid cash conversion from earnings. However, free cash flow growth is negative compared to 2023, which may suggest higher capital expenditure needs or reduced cash generation. Despite this, the company maintains a positive cash position and has managed its cash flows effectively. Overall, the cash flow analysis reveals stability with some cautionary notes on growth trajectories.70
Positive
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 150.68M | 80.23M | 70.00M | 44.86M | 19.49M | 47.52M | Gross Profit |
| 133.17M | 41.32M | 36.15M | 38.68M | 19.19M | 38.52M | EBIT |
| 99.72M | 20.67M | 93.09M | 33.92M | -197.71M | 35.97M | EBITDA |
| 68.04M | 149.96M | 88.44M | 0.00 | -136.79M | 38.21M | Net Income Common Stockholders |
| 26.29M | 22.39M | 10.62M | 33.92M | -197.71M | 35.97M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 501.81M | 83.45M | 67.78M | 35.50M | 31.43M | 600.67M | Total Assets |
| 2.13B | 2.20B | 2.38B | 2.28B | 1.65B | 2.45B | Total Debt |
| 1.55B | 1.72B | 1.91B | 1.82B | 1.31B | 1.87B | Net Debt |
| 1.47B | 1.64B | 1.84B | 1.78B | 1.28B | 1.79B | Total Liabilities |
| 1.58B | 1.75B | 1.94B | 1.84B | 1.32B | 1.90B | Stockholders Equity |
| 553.82M | 435.80M | 435.47M | 448.19M | 334.38M | 556.40M |
| Cash Flow | Free Cash Flow | ||||
| 28.01M | 45.61M | 31.96M | 40.53M | 31.80M | 43.33M | Operating Cash Flow |
| 28.01M | 45.61M | 32.70M | 40.59M | 31.81M | 43.33M | Investing Cash Flow |
| 228.97M | 161.31M | -232.55M | -390.50M | 244.89M | -313.07M | Financing Cash Flow |
| -286.27M | -219.85M | 20.74M | 566.10M | -303.40M | 268.69M |
ACRES Commercial Realty Technical Analysis
Positive
22.90
Price Trends
18.90
Positive
17.61
Positive
16.06
Positive
Market Momentum
1.01
Negative
78.30
Negative
93.08
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ACR, the sentiment is Positive. The current price of 22.9 is above the 20-day moving average (MA) of 20.65, above the 50-day MA of 18.90, and above the 200-day MA of 16.06, indicating a bullish trend. The MACD of 1.01 indicates Negative momentum. The RSI at 78.30 is Negative, neither overbought nor oversold. The STOCH value of 93.08 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ACR.
ACRES Commercial Realty Risk Analysis
ACRES Commercial Realty disclosed 69 risk factors in its most recent earnings report. ACRES Commercial Realty reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
ACRES Commercial Realty Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $6.72B | 18.11 | 5.55% | 9.63% | -0.97% | 3.75% | |
68 Neutral | $177.18M | 19.82 | 6.75% | ― | -3.46% | ― | |
68 Neutral | $1.48B | 13.55 | 7.06% | 7.89% | -5.09% | 6.25% | |
61 Neutral | $1.39B | ― | -6.02% | 12.02% | -9.71% | -426.57% | |
61 Neutral | $4.76B | 18.68 | -3.83% | 10.24% | 6.25% | -20.78% | |
60 Neutral | $3.54B | ― | -5.01% | 10.58% | -12.86% | -182.05% | |
52 Neutral | $138.25M | ― | -28.15% | 10.60% | -26.87% | -189.15% |
* Real Estate Sector Average
Performance Comparison
ACR
ACRES Commercial Realty
22.90
11.35
98.27%
ARI
Apollo Real Estate
9.98
0.14
1.42%
BXMT
Blackstone Mortgage
20.61
2.63
14.63%
STWD
Starwood Property
19.93
1.59
8.67%
LADR
Ladder Capital
11.66
1.62
16.14%
GPMT
Granite Point Mortgage
2.83
-1.55
-35.39%
ACRES Commercial Realty Earnings Call Summary
Earnings Call Date: Mar 5, 2025 | % Change Since: 13.70% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted positive developments such as net income, successful asset sales, and a strong liquidity position. However, there were challenges, including an increase in risk ratings, credit losses, and a reduction in the loan portfolio. The company is at an inflection point, focusing on asset monetization and redeployment of capital.Highlights
Positive Net Income and Earnings
GAAP net income allocable to common shares in the Fourth Quarter was $4.1 million or $0.52 per share diluted. Earnings available for distribution (EAD) for the Fourth Quarter 2024 was $0.48 per share, up from $0.24 per share in the Third Quarter.
Successful Asset Sales
Sold an office property in Pennsylvania for a gain of $7.5 million. Additionally, sold a loan on an underperforming hotel in Orlando at 94% of basis, allowing capital redeployment.
Preleasing and Occupancy Success
Student housing development at Florida State University opened at 95% occupancy with preleasing for the 2025-2026 school year tracking well, showing a 20% increase in preleasing and near double-digit rent growth.
Strong Liquidity Position
Available liquidity at December 31st was $76.9 million, including $56.7 million of unrestricted cash.
Book Value Increase
GAAP book value per share increased to $28.87 on December 31st, up from $27.92 on September 30th.
Lowlights
Increase in Risk Rating and Credit Losses
Weighted average risk rating increased to 2.9 from 2.7, with twelve loans rated four or five, representing 27% of the portfolio, up from 23%. Total balance for credit losses was $32.8 million, representing 2.2% of the loan portfolio at par.
Loan Portfolio Reduction
Net reduction of the loan portfolio by $81.8 million due to loan payoffs, with only one new commitment of $47.9 million.
Charge-offs and Decreases in Net Interest Income
Recorded a $700,000 charge-off related to the Orlando hotel loan. Net loss on real estate operations of $2.3 million, including depreciation, and a $0.24 decrease in net interest income due to loan payoffs.
Company Guidance
During the Fourth Quarter 2024 earnings call for ACRES Commercial Realty Corp., several key financial metrics and strategic updates were highlighted. The company reported a GAAP net income of $4.1 million, equivalent to $0.52 per diluted share, and a book value per share of $28.87 as of December 31st, up from $27.92 on September 30th. The commercial real estate loan portfolio totaled $1.5 billion, with a weighted average risk rating of 2.9, slightly higher than the previous quarter's 2.7. Loan payoffs amounted to $107.5 million, while new commitments and funded existing loan commitments totaled $47.9 million and $6.2 million, respectively, resulting in a net portfolio reduction of $81.8 million. The weighted average spread over one-month term SOFR was 3.73%. The company's liquidity stood at $76.9 million, with $56.7 million in unrestricted cash. The leverage ratio decreased slightly to 3.0 from 3.3 times due to loan payoffs. In terms of future strategy, ACRES plans to expand its portfolio to between $1.8 billion and $2 billion by the end of 2025, focusing on redeploying capital from real estate sales into the loan portfolio, and aims to achieve mid-teens ROEs and an 8% to 10% EAD range.ACRES Commercial Realty Corporate Events
Financial Disclosures
ACRES Commercial Realty Reports Q3 2024 Earnings
Neutral
Oct 30, 2024
ACRES Commercial Realty Corp., a real estate investment trust focusing on commercial real estate loans and equity investments, reported a GAAP net income of $2.8 million for Q3 2024. The company is committed to maintaining a strong investment portfolio, as highlighted by CEO Mark Fogel. Investors can join a conference call on October 31, 2024, for a detailed discussion of the quarterly results, or access the replay until November 14, 2024.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.