Zacks Investment Research upgraded shares of Ares Capital (NASDAQ:ARCC) from a hold rating to a buy rating in a report issued on Monday. The firm currently has $19.00 target price on the investment management company’s stock.
According to Zacks, “Shares of Ares Capital have outperformed the industry over the past six months. Further, the company has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three out of the trailing four quarters. Its third-quarter 2018 results benefited from improvement in total investment income and healthy portfolio activity. Investment income growth is expected to continue, driven by the acquisition of American Capital, rise in demand for customized financing and improving economy. Moreover, its robust liquidity position and regulatory changes keep us optimistic. However, mounting expenses and the presence of high debt levels remain major concerns for the company.”
A number of other analysts have also recently weighed in on ARCC. BidaskClub cut shares of Ares Capital from a buy rating to a hold rating in a research note on Saturday, December 1st. Oppenheimer set a $18.00 price objective on shares of Ares Capital and gave the stock a buy rating in a research report on Thursday, November 1st. National Securities restated a buy rating and set a $19.00 price objective on shares of Ares Capital in a research report on Monday, August 6th. Finally, Citigroup assumed coverage on shares of Ares Capital in a research report on Thursday, August 23rd. They set a buy rating and a $19.00 price objective for the company. Two equities research analysts have rated the stock with a hold rating and seven have assigned a buy rating to the company. The stock currently has an average rating of Buy and a consensus price target of $18.29.
Shares of NASDAQ:ARCC opened at $16.92 on Monday. The firm has a market cap of $7.21 billion, a P/E ratio of 12.17, a price-to-earnings-growth ratio of 3.46 and a beta of 0.58. The company has a quick ratio of 2.41, a current ratio of 2.41 and a debt-to-equity ratio of 0.62. Ares Capital has a 1-year low of $15.03 and a 1-year high of $17.63.
Ares Capital (NASDAQ:ARCC) last issued its quarterly earnings results on Wednesday, October 31st. The investment management company reported $0.45 earnings per share for the quarter, topping the Zacks’ consensus estimate of $0.40 by $0.05. The firm had revenue of $342.00 million during the quarter, compared to analysts’ expectations of $320.15 million. Ares Capital had a net margin of 72.13% and a return on equity of 9.34%. Ares Capital’s quarterly revenue was up 16.3% compared to the same quarter last year. During the same quarter in the prior year, the business earned $0.36 EPS. As a group, research analysts expect that Ares Capital will post 1.63 earnings per share for the current fiscal year.
The company also recently disclosed a quarterly dividend, which will be paid on Friday, December 28th. Shareholders of record on Friday, December 14th will be given a dividend of $0.39 per share. The ex-dividend date of this dividend is Thursday, December 13th. This represents a $1.56 dividend on an annualized basis and a yield of 9.22%. Ares Capital’s payout ratio is currently 112.23%.
In other news, Director Eric B. Siegel acquired 6,990 shares of the business’s stock in a transaction on Wednesday, September 12th. The stock was bought at an average price of $17.30 per share, for a total transaction of $120,927.00. Following the transaction, the director now owns 36,630 shares in the company, valued at $633,699. The purchase was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. Also, CFO Penelope F. Roll sold 6,000 shares of the company’s stock in a transaction on Tuesday, November 20th. The stock was sold at an average price of $16.76, for a total transaction of $100,560.00. Following the transaction, the chief financial officer now owns 11,147 shares of the company’s stock, valued at approximately $186,823.72. The disclosure for this sale can be found here. In the last 90 days, insiders have acquired 7,590 shares of company stock valued at $131,039. 0.49% of the stock is owned by insiders.
Institutional investors have recently made changes to their positions in the business. Golden Gate Private Equity Inc. raised its position in Ares Capital by 9.0% during the 2nd quarter. Golden Gate Private Equity Inc. now owns 422,000 shares of the investment management company’s stock worth $6,942,000 after buying an additional 35,000 shares during the last quarter. Northeast Financial Consultants Inc raised its position in Ares Capital by 58.5% during the 3rd quarter. Northeast Financial Consultants Inc now owns 45,100 shares of the investment management company’s stock worth $775,000 after buying an additional 16,650 shares during the last quarter. V Wealth Management LLC increased its holdings in shares of Ares Capital by 10.0% in the 3rd quarter. V Wealth Management LLC now owns 53,464 shares of the investment management company’s stock valued at $922,000 after purchasing an additional 4,877 shares in the last quarter. Selective Wealth Management purchased a new position in shares of Ares Capital in the 3rd quarter valued at about $505,000. Finally, Steward Partners Investment Advisory LLC increased its holdings in shares of Ares Capital by 1,069.1% in the 3rd quarter. Steward Partners Investment Advisory LLC now owns 120,354 shares of the investment management company’s stock valued at $2,069,000 after purchasing an additional 110,059 shares in the last quarter. Institutional investors own 39.45% of the company’s stock.
About Ares Capital
Ares Capital Corporation is a business development company specializing in acquisition, recapitalization, mezzanine debt, restructurings, rescue financing, and leveraged buyout transactions of middle market companies. It also makes growth capital and general refinancing. It prefers to make investments in companies engaged in the basic and growth manufacturing, business services, consumer products, health care products and services, and information technology service sectors.
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