Ares Commercial Profitability Analysis
| ACRE Stock | USD 7.29 0.07 0.97% |
Net Loss | First Reported 2012-03-31 | Previous Quarter -6.1 M | Current Value -5.9 M | Quarterly Volatility 9.6 M |
For Ares Commercial profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Ares Commercial to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Ares Commercial Real utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Ares Commercial's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Ares Commercial Real over time as well as its relative position and ranking within its peers.
Ares |
Ares Commercial's Revenue Breakdown by Earning Segment
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Is Mortgage Real Estate Investment Trusts (REITs) space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Ares Commercial. If investors know Ares will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Ares Commercial listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 15.981 | Dividend Share 1.08 | Earnings Share (1.18) | Revenue Per Share 0.725 | Quarterly Revenue Growth (0.56) |
The market value of Ares Commercial Real is measured differently than its book value, which is the value of Ares that is recorded on the company's balance sheet. Investors also form their own opinion of Ares Commercial's value that differs from its market value or its book value, called intrinsic value, which is Ares Commercial's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Ares Commercial's market value can be influenced by many factors that don't directly affect Ares Commercial's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Ares Commercial's value and its price as these two are different measures arrived at by different means. Investors typically determine if Ares Commercial is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Ares Commercial's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
Ares Commercial Real Return On Asset vs. Return On Equity Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Ares Commercial's current stock value. Our valuation model uses many indicators to compare Ares Commercial value to that of its competitors to determine the firm's financial worth. Ares Commercial Real is rated below average in return on equity category among its peers. It also is rated below average in return on asset category among its peers . At present, Ares Commercial's Return On Equity is projected to slightly decrease based on the last few years of reporting. Comparative valuation analysis is a catch-all technique that is used if you cannot value Ares Commercial by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.Ares Return On Asset vs. Return On Equity
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Ares Commercial |
| = | -0.1 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Ares Commercial |
| = | -0.0296 |
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.
Ares Return On Asset Comparison
Ares Commercial is currently under evaluation in return on asset category among its peers.
Ares Commercial Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Ares Commercial, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Ares Commercial will eventually generate negative long term returns. The profitability progress is the general direction of Ares Commercial's change in net profit over the period of time. It can combine multiple indicators of Ares Commercial, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
| Last Reported | Projected for Next Year | ||
| Accumulated Other Comprehensive Income | 153 K | 145.3 K | |
| Operating Income | -11.7 M | -11.1 M | |
| Net Income From Continuing Ops | 3.5 M | 3.3 M | |
| Income Before Tax | -38.9 M | -37 M | |
| Total Other Income Expense Net | -27.2 M | -25.8 M | |
| Net Income Applicable To Common Shares | 34.3 M | 33.1 M | |
| Net Loss | -38.9 M | -36.9 M | |
| Income Tax Expense | -39 K | -37 K | |
| Non Operating Income Net Other | 2 M | 2 M | |
| Net Interest Income | 89 M | 74.9 M | |
| Interest Income | 206.2 M | 143.5 M | |
| Change To Netincome | 53.8 M | 56.4 M | |
| Net Loss | (0.72) | (0.68) | |
| Income Quality | (1.20) | (1.14) | |
| Net Income Per E B T | 1.00 | 1.10 |
Ares Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Ares Commercial. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Ares Commercial position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Ares Commercial's important profitability drivers and their relationship over time.
Ares Commercial Profitability Trends
Ares Commercial profitability trend refers to the progression of profit or loss within a business. An upward trend means that Ares Commercial's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Ares Commercial's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.
Ares Commercial Profitability Drivers Correlations
One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Ares Commercial different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Ares Commercial in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Ares Commercial's future profitability.
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To fully project Ares Commercial's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Ares Commercial Real at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Ares Commercial's income statement, its balance sheet, and the statement of cash flows.