Analyzing CV (OTCMKTS:CVHL) and Ares Commercial Real Estate (NYSE:ACRE)

Ares Commercial Real Estate (NYSE:ACRE) and CV (OTCMKTS:CVHL) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, valuation, risk, dividends, analyst recommendations and institutional ownership.

Insider & 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, 7.6% of CV shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Ares Commercial Real Estate and CV”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ares Commercial Real Estate	$54.83 million	5.33	-$900,000.00	($0.02)	-263.75
CV	$25.67 million	N/A	-$18.15 million	N/A	N/A

Ares Commercial Real Estate has higher revenue and earnings than CV.

Analyst Recommendations

This is a summary of current recommendations and price targets for Ares Commercial Real Estate and CV, as reported by MarketBeat.com.

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

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

Profitability

This table compares Ares Commercial Real Estate and CV’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%
CV	N/A	N/A	N/A

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, CV has a beta of 1.56, suggesting that its share price is 56% more volatile than the S&P 500.

Summary

Ares Commercial Real Estate beats CV on 6 of the 11 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 CV

CV Holdings, Inc. operates as a specialty finance company. It owns finance platforms across various businesses, including small-ticket equipment financing and commercial real estate bridge lending. CV Holdings, Inc. was incorporated in 2005 and is based in Newport Beach, California.