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Ares Commercial Real Estate Corp: Sell Rating Amid Challenging Market and Unattractive Valuation

Ares Commercial Real Estate Corp: Sell Rating Amid Challenging Market and Unattractive Valuation

Donald Fandetti, an analyst from Wells Fargo, reiterated the Sell rating on Ares Commercial (ACREResearch Report). The associated price target remains the same with $5.50.

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Donald Fandetti has given his Sell rating due to a combination of factors impacting Ares Commercial Real Estate Corp. Despite reporting distributable earnings per share that exceeded expectations, the company still faces a challenging market environment. The stability in credit migration is a positive sign, but it is not enough to offset the broader challenges.
Ares Commercial has made strides in improving liquidity and reducing leverage, as evidenced by significant loan repayments and a decrease in outstanding principal. However, the company’s current valuation does not present compelling value compared to other opportunities in the market. As a result, Fandetti maintains an Underweight rating, suggesting that investors may find better returns elsewhere.

According to TipRanks, Fandetti is a 5-star analyst with an average return of 11.7% and a 65.95% success rate. Fandetti covers the Financial sector, focusing on stocks such as Capital One Financial, Discover Financial Services, and Synchrony Financial.

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