Investors interested in Finance stocks should always be looking to find the best-performing companies in the group. Has Ares Commercial Real Estate (ACRE) been one of those stocks this year? A quick glance at the company's year-to-date performance in comparison to the rest of the Finance sector should help us answer this question.Ares Commercial Real Estate is one of 853 companies in the Finance group. The Finance group currently sits at #4 within the Zacks Sector Rank. The Zacks Sector Rank includes 16 dif ...

Over the past several years, mortgage REITs have been in a period of consolidation, recovery, and redirection. In the glory days after the pandemic, when real estate was hot and the market was moving at light speed, mortgage REITs were growingAnalyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving co ...

Core Insights - Mortgage REITs have experienced a period of consolidation, recovery, and redirection over the past several years [1] - Following the pandemic, the real estate market saw significant growth, leading to an expansion of mortgage REITs [1]

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Bryan Donohoe: Thank you, John. Good afternoon, everyone, and thank you for joining us. I'm here today with Jeffrey Gonzales, our Chief Financial Officer, Tae Sik Yoon, our Chief Operating Officer, as well as other members of the management and investor relations teams. Today, I'll start off with some market commentary, take a look back at all that we accomplished in 2025, and discuss where we're focused in 2026 and beyond. Jeffrey will then take us through our fourth quarter and full year results in detail ...

Financial Data and Key Metrics Changes - For the full year 2025, the company reported a GAAP net loss of $1 million or $0.02 per diluted common share, and a distributable earnings loss of $7 million or $0.12 per diluted common share [14] - In Q4 2025, the company reported a GAAP net loss of approximately $4 million or $0.07 per diluted common share, while distributable earnings were approximately $8 million or $0.15 per diluted common share, including a realized gain of $2 million [14][15] - The net debt-to-equity ratio at the end of Q4 was 1.6x, reflecting moderate leverage to support future growth [16] Business Line Data and Key Metrics Changes - The company reduced office loans by 30% since year-end 2024 to $447 million, representing a 10% decrease quarter-over-quarter [7][17] - New loan commitments in Q4 totaled $393 million, contributing to a loan portfolio growth of 24% compared to Q3 2025, reaching an outstanding principal balance of $1.6 billion [16] Market Data and Key Metrics Changes - The Ares Real Estate debt platform originated over $9 billion globally in new commitments in 2025, nearly double the amount from 2024 [12] - The company noted that more than 50% of new loan originations were collateralized by residential and industrial properties, indicating a strategic shift towards these sectors [11] Company Strategy and Development Direction - The company aims to resolve the remaining risk-rated 4 and 5 loans while maintaining a flexible balance sheet with ample liquidity exceeding $100 million [6][12] - The focus for 2026 includes addressing underperforming loans and reshaping the portfolio to enhance future growth [12][23] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the commercial real estate market experienced a transition in 2025, with improved conditions in the second half of the year due to easing monetary policy [5] - The company expressed confidence in its earnings potential despite recognizing that the trajectory of earnings may be uneven based on asset resolutions [12] Other Important Information - The board declared a regular cash dividend of $0.15 per common share for Q1 2026, reflecting confidence in the company's earnings growth potential [12][22] - The total CECL reserve at year-end 2025 was $127 million, with 92% related to risk-rated 4 and 5 loans [20] Q&A Session Summary Question: When will Brooklyn start receiving repayments for the condo project? - Management indicated that sales are expected to begin in the second half of 2026, with proceeds first going to pay down debt [25][26] Question: What is the current debt yield for the Chicago office asset? - Management noted that while specific yields were not disclosed, the asset's occupancy and weighted average lease term provide some stability [28] Question: What are the attractive risk-adjusted returns across different sectors? - Management highlighted a broad spectrum of opportunities, particularly in logistics, industrial, and multifamily sectors, while continuing to avoid the office sector [36] Question: How much higher is ACRE's leverage expected to trend throughout 2026? - Management expects leverage to potentially reach around 2.0x in the near term, with a long-term target of 3.0x [45] Question: Is the facility with Ares still in place for quick loan onboarding? - Management confirmed that the capacity for warehousing assets is still available, though its utilization may decrease due to the current structuring strategies [60]

Financial Data and Key Metrics Changes - For the full year 2025, the company reported a GAAP net loss of $1 million or $0.02 per diluted common share, and a distributable earnings loss of $7 million or $0.12 per diluted common share [14] - In Q4 2025, the company reported a GAAP net loss of approximately $4 million or $0.07 per diluted common share, while distributable earnings were approximately $8 million or $0.15 per diluted common share [14][15] - The net debt-to-equity ratio at the end of Q4 was 1.6 times, reflecting moderate leverage [16] Business Line Data and Key Metrics Changes - The company reduced office loans by 30% since year-end 2024 to $447 million, representing a 10% decrease quarter-over-quarter [7][17] - New loan commitments in Q4 totaled $393 million, contributing to a total loan portfolio of $1.6 billion, an increase of 24% from Q3 2025 [16] - New loans closed in the second half of 2025 now comprise about 29% of the total loan portfolio [16] Market Data and Key Metrics Changes - The Ares Real Estate debt platform originated over $9 billion globally in new commitments in 2025, nearly double the amount from 2024 [12] - The company anticipates that the trajectory of earnings may be uneven depending on the resolution of asset issues, but remains confident in earnings potential [12] Company Strategy and Development Direction - The company aims to address risk-rated 4 and 5 loans while reducing office exposure, which is seen as crucial for future growth [23] - A focus on co-investment opportunities is intended to enhance diversification and efficiently deploy capital [11] - The board declared a regular cash dividend of $0.15 per common share for Q1 2026, reflecting confidence in the execution of the business plan [12][22] Management's Comments on Operating Environment and Future Outlook - The management noted that macroeconomic and geopolitical uncertainties affected valuations and transaction activity early in 2025, but conditions improved in the second half of the year [5] - The company is optimistic about the market for assets like residential and industrial properties, while remaining cautious about office properties [38] - Management expressed confidence in the ability to resolve remaining risk-rated loans and achieve portfolio growth [12][23] Other Important Information - The total CECL reserve at year-end 2025 was $127 million, with 92% related to risk-rated 4 and 5 loans [20] - The company has increased its borrowing capacity by $250 million and reduced borrowing costs through various actions [21] Q&A Session Summary Question: When will Brooklyn start receiving repayments for the condo project? - Management hopes to see a smooth sales process in the second half of 2026, with proceeds expected to start coming back into the company after debt repayment [25][26] Question: What is the current debt yield for the Chicago office asset? - Management indicated that while they have not provided a specific yield, the asset's occupancy and lease duration provide some patience for resolution [28] Question: Where do you see office exposure balanced by the end of 2026? - The focus remains on resolving risk-rated 4 and 5 loans, with expectations for a more regular cadence of asset repayments moving forward [32] Question: Where are the most attractive risk-adjusted returns currently? - Management sees opportunities across various sectors, particularly in logistics, industrial, and multifamily, while continuing to avoid the office sector [36][38] Question: What is the target portfolio size? - The target is to achieve a 3.0 debt-to-equity ratio, which would support a loan portfolio size of approximately $2 billion [59]

Financial Data and Key Metrics Changes - For the full year 2025, the company reported a GAAP net loss of $1 million or $0.02 per diluted common share, and a distributable earnings loss of $7 million or $0.12 per diluted common share [12] - In Q4 2025, the company reported a GAAP net loss of approximately $4 million or $0.07 per diluted common share, while distributable earnings were approximately $8 million or $0.15 per diluted common share, including a realized gain of $2 million [12][13] - The net debt-to-equity ratio at the end of Q4 was 1.6 times, an increase from 1.1 times in the previous quarter [13][42] Business Line Data and Key Metrics Changes - The company reduced office loans by 30% since year-end 2024 to $447 million, representing 28% of the total loan portfolio, down from 38% at the end of Q3 2025 [5][15] - New loan commitments in Q4 totaled $393 million, contributing to a total loan portfolio of $1.6 billion, a 24% increase from Q3 2025 [13][14] - The company closed 13 new loan commitments totaling $486 million in the second half of 2025, with over 50% collateralized by residential and industrial properties [9] Market Data and Key Metrics Changes - The Ares Real Estate debt platform originated over $9 billion globally in new commitments in 2025, nearly double the amount from 2024 [10] - The company anticipates that the trajectory of earnings may be uneven depending on the resolution of asset issues, but remains confident in its earnings potential [10] Company Strategy and Development Direction - The company aims to address risk-rated 4 and 5 loans while reducing office and REO assets, focusing on portfolio reshaping and investment activity [5][10] - The board declared a regular cash dividend of $0.15 per common share for Q1 2026, reflecting confidence in the execution of the business plan [10][20] - The company is focused on maintaining moderate leverage and ample liquidity, with available capital exceeding $100 million [5][19] Management's Comments on Operating Environment and Future Outlook - Management noted that the commercial real estate market experienced a transition in 2025, with improved conditions in the second half of the year due to easing monetary policy [4] - The company is optimistic about the potential for earnings growth and the resolution of remaining risk-rated loans, despite acknowledging that the timeline for asset resolutions is somewhat outside of their control [21][30] Other Important Information - The total CECL reserve at year-end 2025 was $127 million, representing approximately 8% of the total outstanding principal balance of loans held for investment [18] - The company has increased its borrowing capacity by $250 million and reduced borrowing costs through various actions [19] Q&A Session Summary Question: When will Brooklyn start receiving repayments for the condo project? - Management hopes to see a smooth sales process in the second half of 2026, with proceeds expected to pay down debt [23][24] Question: What is the current debt yield for the Chicago office asset? - Management indicated that while they have not provided a specific yield, the asset's occupancy and lease duration provide some patience for resolution [25][26] Question: Where do you see office exposure balanced by the end of 2026? - The focus remains on resolving risk-rated 4 and 5 loans, with expectations for a more regular cadence of asset repayments moving forward [29][30] Question: Where are the most attractive risk-adjusted returns currently? - Management noted a broad spectrum of opportunities across sectors, with a focus on logistics, industrial, and multifamily segments [34][35] Question: How much higher is ACRE's leverage expected to trend throughout 2026? - Management expects leverage to max out around 2.0 times in the near term, with a long-term target of 3.0 times [41][42] Question: What is the target portfolio size? - Management indicated that achieving a 3.0 debt-to-equity ratio would imply a loan portfolio size of about $2 billion [56]

Fourth Quarter and Full Year 2025 Earnings Presentation Exhibit 99.2 Disclaimer Statements included herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended, which may relate to future events or the future performance or financial condition of Ares Commercial Real Estate Corporation ("ACRE" or, the "Company"), Ares Commercial Real Estate Management LLC ("ACREM" or the Compa ...

分组1 - Ares Commercial Real Estate (ACRE) reported quarterly earnings of $0.15 per share, significantly exceeding the Zacks Consensus Estimate of $0.01 per share, and showing a turnaround from a loss of $0.15 per share a year ago, resulting in an earnings surprise of +1,027.82% [1] - The company posted revenues of $23.73 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 6.07%, although this represents a decline from year-ago revenues of $33.49 million [2] - ACRE has outperformed the S&P 500, with shares increasing about 6.9% since the beginning of the year compared to the S&P 500's gain of 1.7% [3] 分组2 - The earnings outlook for ACRE is mixed, with the current consensus EPS estimate for the coming quarter at $0.07 on revenues of $23.35 million, and $0.25 on revenues of $100.33 million for the current fiscal year [7] - The Zacks Industry Rank indicates that the REIT and Equity Trust sector is currently in the bottom 21% of over 250 Zacks industries, suggesting that the industry's outlook could materially impact stock performance [8] - Another company in the same industry, Adamas Trust, is expected to report quarterly earnings of $0.24 per share, reflecting a year-over-year change of +154.6%, with revenues projected at $42.4 million, up 58.7% from the previous year [9][10]