As Ares Commercial Real Estate (ACRE) has dropped to a 52-week low price and historical low P/B ratio and announced a public offering, several of the company’s insiders have taken the opportunity to buy their own shares into the company. To paraphrase Peter Lynch’s popular quote — insiders only spend their own money when they think the stock price is soon to rise.
Ares Commercial Real Estate Corporation is a specialty finance company that originates, invests in and manages middle-market commercial real estate loans and other commercial real estate investments. Through its national direct origination platform, Ares Commercial Real Estate Corporation provides flexible financing solutions for middle-market borrowers.
Ares announced the pricing of its public offering on June 21 and the offering closed on June 26. The company offered 18 million shares of its common stock for $13.50 per share.
At this point seven insiders made significant buys into the company. The following insiders made buys: Co-CEO Todd Schuster, President and COO Bruce Cohen, Director Paul Joubert, Director Robert Rosen, Director Michael Arougheti, VP and General Counsel Michael Weiner and Co-CEO John Bartling.
These seven insiders added a total of 246,333 shares of Ares stock at the public offering price. This buy marks the largest cluster buy for the insiders. Since the group buy, the price per share has decreased 5.56%.
Ares share prices took a tumble as it released its first quarter financials where it reported:
· Net loss attributable to common stockholders was $0.3 million, or $0.04 per diluted share.
· Core earnings (loss) were $0.9 million, or $0.09 per basic and common diluted share.
· The company also announced its proposed acquisition of Alliant Capital LLC.
Ares Commercial Real Estate Corporation has a market cap of $115.4 million; its shares were traded at $12.75 with a P/E ratio of 175.20 and a P/S ratio of 7.30. The dividend yield for the company is 6.40%.
The analysis on the company reports that the dividend yield is close to a one-year high, the price has dropped beneath its previous two-year low of $13.08 and the P/S ratio of Ares is at a one-year low.
Jim Simons, First Pacific Advisors and Pioneer Investments maintain holdings in Ares. Click here to see their holding histories.
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