Altisource Portfolio Solutions (NASDAQ:ASPS – Get Free Report) and Ares Commercial Real Estate (NYSE:ACRE – Get Free Report) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, valuation, analyst recommendations and dividends.
Volatility & Risk
Altisource Portfolio Solutions has a beta of 0.23, indicating that its share price is 77% less volatile than the S&P 500. Comparatively, Ares Commercial Real Estate has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.
Earnings & Valuation
This table compares Altisource Portfolio Solutions and Ares Commercial Real Estate”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Altisource Portfolio Solutions | $168.27 million | 0.78 | -$35.64 million | ($4.36) | -2.74 |
| Ares Commercial Real Estate | $69.65 million | 3.45 | -$34.99 million | ($0.34) | -12.84 |
Ares Commercial Real Estate has lower revenue, but higher earnings than Altisource Portfolio Solutions. Ares Commercial Real Estate is trading at a lower price-to-earnings ratio than Altisource Portfolio Solutions, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
41.4% of Altisource Portfolio Solutions shares are owned by institutional investors. Comparatively, 41.3% of Ares Commercial Real Estate shares are owned by institutional investors. 2.3% of Altisource Portfolio Solutions shares are owned by company insiders. Comparatively, 1.8% of Ares Commercial Real Estate shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Profitability
This table compares Altisource Portfolio Solutions and Ares Commercial Real Estate’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Altisource Portfolio Solutions | -4.10% | N/A | -8.68% |
| Ares Commercial Real Estate | -29.57% | -5.44% | -1.78% |
Analyst Recommendations
This is a breakdown of recent ratings for Altisource Portfolio Solutions and Ares Commercial Real Estate, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Altisource Portfolio Solutions | 0 | 0 | 0 | 0 | 0.00 |
| Ares Commercial Real Estate | 1 | 5 | 0 | 0 | 1.83 |
Ares Commercial Real Estate has a consensus target price of $5.3125, indicating a potential upside of 21.71%. Given Ares Commercial Real Estate’s stronger consensus rating and higher probable upside, analysts clearly believe Ares Commercial Real Estate is more favorable than Altisource Portfolio Solutions.
Summary
Ares Commercial Real Estate beats Altisource Portfolio Solutions on 7 of the 13 factors compared between the two stocks.
About Altisource Portfolio Solutions
Altisource Portfolio Solutions S.A. operates as an integrated service provider and marketplace for the real estate and mortgage industries in the United States and internationally. It operates through Servicer and Real Estate, and Origination segments. The Servicer and Real Estate segment offers property preservation, inspection, title insurance and settlement, real estate valuation, foreclosure trustee, and residential and commercial construction inspection and risk mitigation services. This segment provides Hubzu, an online real estate auction platform, as well as real estate auction, real estate brokerage, and asset management services; Equator, a software-as-a-service technology to manage real estate owned, short sales, foreclosure, bankruptcy, and eviction processes; a vendor invoicing and payment system; RentRange, a single and multi-family rental data, analytics, and rent-based valuation solution; REALSynergy, a commercial loan servicing platform; and NestRange, an automated residential valuation model and analytics solution. The Origination segment offers loan fulfillment, certification and certification insurance services, management services. In addition, it provides Lendors One Loan Automation, a marketplace to order services and a tool to automate components of the loan manufacturing process; TrelixAI, a technology to manage the workflow and automate components of the loan fulfillment, pre and post close quality, and service transfer processes; and ADMS, a document management and data analytics delivery platform. The company serves financial institutions, government-sponsored enterprises, banks, asset managers, servicers, investors, property management firms, real estate brokerages, insurance companies, mortgage bankers, originators, and correspondent and private money lenders. Altisource Portfolio Solutions S.A. was incorporated in 1999 and is headquartered in Luxembourg City, Luxembourg.
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.
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