Have Ares Commercial Real Estate Insiders Been Selling Stock?

We'd be surprised if Ares Commercial Real Estate Corporation (NYSE:ACRE) shareholders haven't noticed that the CEO & Director, Bryan Donohoe, recently sold US$133k worth of stock at US$5.68 per share. That sale was 17% of their holding, so it does make us raise an eyebrow.

See our latest analysis for Ares Commercial Real Estate

Ares Commercial Real Estate Insider Transactions Over The Last Year

In fact, the recent sale by Bryan Donohoe was the biggest sale of Ares Commercial Real Estate shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (US$5.98). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 17% of Bryan Donohoe's stake.

Insiders in Ares Commercial Real Estate didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Ares Commercial Real Estate better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Ares Commercial Real Estate insiders own 4.0% of the company, worth about US$13m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Ares Commercial Real Estate Tell Us?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ares Commercial Real Estate. For example, Ares Commercial Real Estate has 3 warning signs (and 2 which are a bit concerning) we think you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.