ACRES Commercial Realty Corp. (NYSE: ACR)

Sector: Real Estate Industry: REIT - Mortgage CIK: 0001332551
Market Cap 152.04 Mn
P/B 0.35
P/E 20.88
P/S 1.87
ROIC (Qtr) 0.67
Div Yield % 0.00
Rev 1y % (Qtr) -5.89
Total Debt (Qtr) 1.23 Bn
Debt/Equity (Qtr) 2.85

About

ACRES Commercial Realty Corp., or ACR, is a real estate investment trust (REIT) that operates in the real estate finance industry, with its stock trading under the symbol ACR. The company, established in 2005, specializes in originating, holding, and managing commercial real estate (CRE) mortgage loans and equity investments in commercial real estate properties. ACR's focus is on investing in transitional floating-rate CRE loans ranging from $10 million to $100 million, with a weighted average spread of 3.77% over the one-month benchmark interest...

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Price action

Investment thesis

Bull case

  • Cash position of 42.68M provides exceptional 18.09x coverage of minority interest expenses 2.36M, indicating strong liquidity.
  • Cash reserves of 42.68M provide comfortable 6097.14x coverage of tax obligations 7000, showing strong fiscal management.
  • Strong tangible asset base of 1.68B provides 261.13x coverage of intangibles 6.44M, indicating robust asset quality.
  • Cash position of 42.68M fully covers payables of 13.41M by 3.18x, showing strong vendor relationship management.

Bear case

  • Operating cash flow of (1.46M) barely covers its investment activities of 328.80M, with a coverage ratio of -0, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Cash reserves of 42.68M provide limited coverage of acquisition spending of (9.16M), which is -4.66x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of (1.46M) shows concerning coverage of stock compensation expenses of 2.61M, with a -0.56 ratio indicating potential earnings quality issues.
  • Free cash flow of (1.56M) provides weak coverage of capital expenditures of 106000, with a -14.75 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of (1.46M) provides minimal -19.96x coverage of tax expenses of 73000, suggesting potential tax planning inefficiencies or unsustainable tax positions.

Peer comparison

Companies in the REIT - Mortgage
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 NLY Annaly Capital Management Inc 13.98 Bn 10.42 8.17 107.02 Bn
2 AGNC AGNC Investment Corp. 11.44 Bn 16.65 30.74 95.01 Bn
3 STWD Starwood Property Trust, Inc. 6.55 Bn 17.88 3.63 21.43 Bn
4 RITM Rithm Capital Corp. 5.78 Bn 7.43 1.16 34.97 Bn
5 BXMT Blackstone Mortgage Trust, Inc. 3.36 Bn 31.37 6.62 15.46 Bn
6 ARR Armour Residential REIT, Inc. 1.83 Bn 34.78 15.64 16.56 Bn
7 DX Dynex Capital Inc 1.59 Bn 9.04 6.88 11.75 Bn
8 ABR Arbor Realty Trust Inc 1.50 Bn 9.84 2.84 10.40 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.87 0.83
EV to Cash from Ops. EV/CFO -1,003.67 -102.96
EV to Debt EV to Debt 1.19 1.31
EV to EBIT EV/EBIT 51.00 -260.73
EV to EBITDA EV/EBITDA 58.65 -16.37
EV to Free Cash Flow [EV/FCF] EV/FCF -935.61 3.47
EV to Market Cap EV to Market Cap 9.60 9.18
EV to Revenue EV/Rev 17.98 26.77
Price to Book Value [P/B] P/B 0.35 0.68
Price to Earnings [P/E] P/E 20.92 -4.85
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.34 -0.55
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 29.47
Dividend per Basic Share Div per Share (Qtr) 0.00 1.15
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 57.60
Interest Coverage Interest Coverage 0.00 -0.17
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -1,225.00 37.60
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -39.92 24.22
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 4.53
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 8.79 17.83
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 13.45 9.86
EBIT Growth (1y) % EBIT 1y % (Qtr) 8.64 20.98
EBT Growth (1y) % EBT 1y % (Qtr) 8.64 11.17
EPS Growth (1y) % EPS 1y % (Qtr) 18.60 59.25
FCF Growth (1y) % FCF 1y % (Qtr) -105.58 59.63
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -4.04 20.65
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.05 0.04
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.83
Cash Ratio Cash Ratio 0.00 0.00
Current Ratio Current Ratio 0.00 0.00
Debt to Equity Ratio Debt/Equity (Qtr) 2.85 5.05
Interest Cover Ratio Interest Cover Ratio 0.00 -0.17
Times Interest Earned Times Interest Earned 0.00 -0.17
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 51.70 137.11
EBIT Margin % EBIT Margin % (Qtr) 35.25 142.19
EBT Margin % EBT Margin % (Qtr) 35.25 129.16
Gross Margin % Gross Margin % (Qtr) 88.90 117.97
Net Profit Margin % Net Margin % (Qtr) 9.00 125.89