ACR

ACR is an externally-managed commercial-real-estate mortgage REIT whose reported P/E of 600 and 97% EPS collapse to $0.03 are optical, not operational: net income held roughly flat at $28.0M (down just 2.5%), but the 10-K states all 2025 taxable income was distributed to preferred shareholders, so almost nothing reached the common line. The real story is on the balance sheet. Stockholders' equity is $421M against a market cap of just $128M (7.13M shares at $18.00). Even after carving out the preferred that is absorbing the earnings, the common trades at a visible discount to book, and management is leaning into that gap — cash paid for buybacks jumped 183% to $22.3M and the share count fell 4.4%, both accretive to book value per share when repurchasing below book.

The loan book is growing and mostly performing. Per the MD&A, ACRES originated 14 new floating-rate whole loans totaling $733.0M plus mezzanine and preferred-equity pieces, producing a net $341.5M portfolio increase to $1.8B, with all but three CRE whole loans current on contractual payments. Total assets rose 14.9% to $2.16B and cash grew 47.7% to $83.8M, giving liquidity to fund originations and weather workouts. Leverage of 3.83x liabilities/equity is normal for a mortgage REIT rather than distressed, though long-term debt did climb 13.3% to $1.55B.