UPDATE: Citi Initiates Coverage on Ares Commercial Real Estate

According to a research report published this morning, Citi has initiated Ares Commercial Real Estate ACRE with a Buy rating and $20 PT. In the report, Citi said, "ACRE shares have traded down -13% from the IPO price of $18.50 and now trade at 0.88x post IPO book value (versus direct peers trading at premiums), creating an attractive entry point, in our view. As the portfolio expands, we believe the valuation disparity will narrow and we expect ACRE to trade at or slightly above book value. And our fully ramped expected dividend yield of ~10% on the current share price is attractive, in our view." Ares Commercial Real Estate closed Friday at $16.26.