EPCM Quietly Pulls Out of ACRES Preferred Shares, Selling at a 12% Premium in a Calculated Wind‑Down Strategy.

Eagle Point’s Quiet Exit from ACRES Preferred Stock The most recent filing shows Eagle Point Credit Management LLC (EPCM) liquidating a substantial block of 7.875 % Series D Preferred Stock on January 28, 2026. The sale of 201 shares at $22.10 each reduces EPCM’s D‑Series holdings to 753,398 shares, a drop of roughly 0.3 % of its total preferred stake. While the transaction size is modest relative to the overall capital structure—ACRES’ market cap hovers at $138 million and its 52‑week high was $24.61—the timing is telling. The sale comes after a streak of consecutive daily sells from January 23 through 30, suggesting a deliberate wind‑down rather than a single opportunistic trade.

Investor Outlook: Signal or Noise? The price at which EPCM exited the D‑Series (around $22) sits comfortably above the current market price of $19.52, indicating a 12‑% premium. For shareholders, this premium may be interpreted as a bullish signal that EPCM believes the preferred shares are undervalued relative to the broader equity. However, the broader market context—ACRES’ weekly decline of nearly 4 % and a 10 % monthly slide—highlights ongoing volatility. If EPCM’s exit is part of a broader strategy to reallocate capital into more liquid common equity, investors might anticipate a modest upside for the common shares as preferred holders shift focus. Conversely, a sustained sell‑off could weigh on sentiment, especially if other insiders follow suit.

EPCM’s Transactional DNA A review of EPCM’s historic filings reveals a pattern of frequent, incremental sales across both Series C and D preferred shares throughout December 2025 and January 2026. The owner consistently sold large blocks—often exceeding 5,000 shares—at premium prices, while maintaining a substantial holding in the common stock (≈1.18 million shares). This behavior suggests a long‑term investment mandate that balances liquidity needs against a core equity stake. EPCM’s reliance on private investment funds (the “Applicable Accounts”) and its role as general partner in Eagle Point DIF GP I LLC further indicate a structured, perhaps fund‑managed, approach to asset allocation rather than speculative short‑term trading.

What Could This Mean for ACRES Going Forward? If EPCM’s recent sell‑off reflects a broader rebalancing, the company may see an influx of capital from the preferred tier, potentially supporting debt repayments or new acquisitions. The company’s asset‑backed fund model could benefit from the capital freed up by preferred liquidation, improving leverage ratios and freeing up cash flow for distribution to common shareholders. On the flip side, a concentration of sales from a key holder may trigger concerns about insider confidence. Analysts will likely monitor subsequent filings for any further divestiture or, conversely, any repurchase activity that could signal a shift back to a preferred‑heavy structure.

Key Takeaway for Investors EPCM’s measured, premium‑price sales point to a calculated exit strategy from its preferred holdings, likely driven by a desire to shore up liquidity or reposition its portfolio. While the move does not immediately alter ACRES’ capital structure, it could influence short‑term liquidity dynamics and market perception. Investors should watch for follow‑up trades and assess whether this pattern heralds a broader realignment of ACRES’ shareholder base or simply reflects a routine fund‑level rebalancing.