Ares Commercial Real Estate Corporation (ACRE) Signaling a Major Plunge Is Coming?

Analysts at Raymond James raised their recommendation on shares of Ares Commercial Real Estate Corporation (NYSE:ACRE) from Outperform to Strong Buy in their opinion released on January 11. BTIG Research, analysts launched coverage of ACRE stock with a Buy recommendation, according to their flash note issued to investors on October 09. Analysts at BofA/Merrill released an upgrade from Underperform to Buy for the stock, in a research note that dated back to May 02.

ACRE shares were last closed at $14.18, up 0.01 points (0.07% higher) from its previous close of $14.17. The stock sets a high trading volume day with a reported 146621 contracts on 02/11/2019. ACRE shares had a relatively low volume day versus average trading capacity of 165.69 thousand shares, but with a 25.66 million float and a -0.91% run over a week, it’s definitely worth keeping an eye on. The one year price forecast for ACRE stock indicates that the average analyst price target is $14.75 per share. This means the stock has a potential increase of 4.02% from where the ACRE share price has been trading recently, which is between $14.06 and $14.19. There are some brokerage firms that offer lower targets than the average, with one of them, even setting their price target at $14. Flipping the other side of the coin, an analyst who is fully bullish set a price target as high as $53.

Technical chart claims that Ares Commercial Real Estate Corporation (ACRE) would settle between $14.23/share to $14.27/share level. However, if the stock price goes below the $14.1 mark, then the market for Ares Commercial Real Estate Corporation becomes much weaker. If that happens, the stock price might even plunge as low as $14.01 for its downside target. The stock is currently in the red zone of MACD, with the indicator reading -0.1. Traders are always alerted for the move of a stock above or below the zero line due to the fact that the reading is an indicator of the position of the short-term average relative to the long-term average. If the MACD is above the zero line, then the short-term average relative is above that of the long-term average, thus implying an upward momentum. Vice versa is the case if the MACD is below the zero line.

Looking at the current readings for Ares Commercial Real Estate Corporation, the two-week RSI stands at 51.11. This figure suggests that ACRE stock, for now, is neutral, meaning that the shares are stable in terms of price movement. The stochastic readings, on the other hand, based on the current ACRE readings is similarly very revealing as it has a stochastic reading of 58.42% at this stage. This figure means that ACRE share price today is being neutral.

ACRE equity has an average rating of 2.29, with the figure leaning towards a bullish end. 7 analysts who tracked the company were contacted by Reuters. Amongst them, 4 rated the stock as a hold while the remaining 3 were split even though not equally. Some analysts rate the stock as a buy or a strong buy while no rated it as a sell. 3 analysts rated Ares Commercial Real Estate Corporation (NYSE:ACRE) as a buy or a strong buy while not a single analyst advised that investors should desist from purchasing the stock or sell them if they already own the company’s stock.

During the recent trading session for Ares Commercial Real Estate Corporation (NYSE:ACRE), the company witnessed their stock drop by -0.13% over a week and tumble down -0.17% from the price 20 days ago. When compared to their established 52-week high of $14.77, the high they recorded in their recent session happens to be lower. Their established 52-week high was attained by the company on 08/31/18. The recent low of $11.96 stood for a -3.98% since 02/12/18, a data which is good for most investors who are looking to take advantage of the stock’s recent rise. A beta of 0.67 is also allocated to the stock. Since the beta is less than one, it implies that the stock is more volatile than the market, a data that traders are keeping close attention to.

Moving on, ACRE stock price is currently trading at 10.7X forward 12-month Consensus EPS estimates, and its P/S ratio is 3.61 while for the average stock in the same group, the multiple is 8.86.Ares Commercial Real Estate Corporation current P/E ratio of 11.67 means it is trading at a discount against its industry’s 50.57. In the past 5 years, this ratio for the stock has been fluctuating between 11.98 and 18.12.