Ares Commercial Real Estate (NYSE:ACRE) and Bimini Capital Management (OTCMKTS:BMNM) Head-To-Head Comparison

Ares Commercial Real Estate (NYSE:ACRE) and Bimini Capital Management (OTCMKTS:BMNM) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.

Profitability

This table compares Ares Commercial Real Estate and Bimini Capital Management’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ares Commercial Real Estate	-1.64%	-1.99%	-0.70%
Bimini Capital Management	34.35%	63.32%	4.15%

Dividends

Ares Commercial Real Estate pays an annual dividend of $0.60 per share and has a dividend yield of 11.4%. Bimini Capital Management pays an annual dividend of $0.13 per share and has a dividend yield of 4.9%. Ares Commercial Real Estate pays out -3,000.0% of its earnings in the form of a dividend. Bimini Capital Management pays out 22.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Ares Commercial Real Estate is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Ares Commercial Real Estate has a beta of 1.2, suggesting that its share price is 20% more volatile than the S&P 500. Comparatively, Bimini Capital Management has a beta of 0.13, suggesting that its share price is 87% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Ares Commercial Real Estate and Bimini Capital Management, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ares Commercial Real Estate	2	3	1	0	1.83
Bimini Capital Management	0	0	0	0	0.00

Ares Commercial Real Estate currently has a consensus target price of $5.38, indicating a potential upside of 1.90%. Given Ares Commercial Real Estate’s stronger consensus rating and higher possible upside, analysts plainly believe Ares Commercial Real Estate is more favorable than Bimini Capital Management.

Earnings and Valuation

This table compares Ares Commercial Real Estate and Bimini Capital Management”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ares Commercial Real Estate	$22.95 million	12.73	-$900,000.00	($0.02)	-263.75
Bimini Capital Management	$16.89 million	1.58	$5.80 million	$0.58	4.57

Bimini Capital Management has lower revenue, but higher earnings than Ares Commercial Real Estate. Ares Commercial Real Estate is trading at a lower price-to-earnings ratio than Bimini Capital Management, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

41.3% of Ares Commercial Real Estate shares are owned by institutional investors. 2.3% of Ares Commercial Real Estate shares are owned by insiders. Comparatively, 45.4% of Bimini Capital Management shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Ares Commercial Real Estate beats Bimini Capital Management on 9 of the 16 factors compared between the two stocks.

About Ares Commercial Real Estate

Ares Commercial Real Estate Corporation, a specialty finance company, originates and invests in commercial real estate (CRE) loans and related investments in the United States. It provides a range of financing solutions for the owners, operators, and sponsors of CRE properties. The company originates senior mortgage loans, subordinate debt and preferred equity products, mezzanine loans, and other CRE investments, including commercial mortgage-backed securities. It has elected and qualified to be taxed as a real estate investment trust for the United States federal income tax purposes under the Internal Revenue Code of 1986. Ares Commercial Real Estate Corporation was incorporated in 2011 and is based in New York, New York.

About Bimini Capital Management

Bimini Capital Management, Inc., through its subsidiaries, operates as a specialty finance company in the United States. The company operates in two segments, Asset Management and Investment Portfolio. The Asset Management segment includes investment advisory services by Bimini Advisors to Orchid Island Capital, Inc. and Royal Palm Capital, LLC. The Investment Portfolio segment engages in investment activities conducted by Royal Palm Capital, LLC. It invests in residential mortgage-backed securities. The company was formerly known as Opteum Inc. and changed its name to Bimini Capital Management, Inc. in September 2007. Bimini Capital Management, Inc. was founded in 2003 and is based in Vero Beach, Florida.