Ares Capital (NASDAQ:ARCC) Shares Down 1.8% – What’s Next?

Ares Capital Corporation (NASDAQ:ARCC)’s stock price traded down 1.8% during trading on Tuesday . The stock traded as low as $17.89 and last traded at $17.96. 7,854,783 shares changed hands during trading, an increase of 4% from the average session volume of 7,531,544 shares. The stock had previously closed at $18.28.

Wall Street Analyst Weigh In

ARCC has been the topic of several recent analyst reports. Wells Fargo & Company cut their target price on Ares Capital from $21.00 to $20.00 and set an “overweight” rating on the stock in a research note on Thursday, February 5th. Wall Street Zen lowered Ares Capital from a “hold” rating to a “sell” rating in a research report on Saturday, February 7th. Weiss Ratings reiterated a “hold (c+)” rating on shares of Ares Capital in a report on Monday, December 29th. B. Riley Financial reiterated a “buy” rating on shares of Ares Capital in a research report on Monday, February 9th. Finally, UBS Group reduced their target price on Ares Capital from $21.00 to $19.00 and set a “neutral” rating on the stock in a research note on Friday, March 13th. Seven investment analysts have rated the stock with a Buy rating and two have given a Hold rating to the stock. According to MarketBeat.com, the stock has an average rating of “Moderate Buy” and an average price target of $21.38.

Ares Capital Stock Performance

The company’s 50-day moving average price is $19.30 and its 200 day moving average price is $20.03. The stock has a market capitalization of $12.87 billion, a PE ratio of 9.63 and a beta of 0.59. The company has a debt-to-equity ratio of 1.12, a quick ratio of 1.70 and a current ratio of 1.70.

Ares Capital (NASDAQ:ARCC) last announced its quarterly earnings results on Wednesday, February 4th. The investment management company reported $0.50 earnings per share (EPS) for the quarter, meeting the consensus estimate of $0.50. Ares Capital had a net margin of 42.56% and a return on equity of 9.89%. The company had revenue of $793.00 million for the quarter, compared to analysts’ expectations of $795.20 million. During the same quarter in the previous year, the company earned $0.55 earnings per share. Ares Capital’s quarterly revenue was up 4.5% on a year-over-year basis. On average, equities research analysts expect that Ares Capital Corporation will post 2.19 earnings per share for the current fiscal year.

Ares Capital Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Tuesday, March 31st. Shareholders of record on Friday, March 13th will be issued a dividend of $0.48 per share. The ex-dividend date is Friday, March 13th. This represents a $1.92 dividend on an annualized basis and a dividend yield of 10.7%. Ares Capital’s dividend payout ratio is 103.23%.

Insider Activity at Ares Capital

In other news, CFO Scott C. Lem purchased 5,186 shares of the company’s stock in a transaction that occurred on Friday, February 6th. The shares were bought at an average cost of $19.29 per share, for a total transaction of $100,037.94. Following the completion of the transaction, the chief financial officer directly owned 39,463 shares of the company’s stock, valued at $761,241.27. This trade represents a 15.13% increase in their position. The acquisition was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, CEO Michael Kort Schnabel purchased 12,500 shares of Ares Capital stock in a transaction that occurred on Thursday, February 5th. The stock was purchased at an average cost of $19.13 per share, for a total transaction of $239,125.00. Following the completion of the purchase, the chief executive officer owned 40,500 shares of the company’s stock, valued at $774,765. This trade represents a 44.64% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. 0.49% of the stock is currently owned by corporate insiders.

Institutional Trading of Ares Capital

A number of hedge funds have recently modified their holdings of ARCC. UBS Group AG grew its position in shares of Ares Capital by 41.8% in the 4th quarter. UBS Group AG now owns 11,201,905 shares of the investment management company’s stock worth $226,615,000 after buying an additional 3,301,890 shares during the period. Invesco Ltd. lifted its position in Ares Capital by 825.4% during the 2nd quarter. Invesco Ltd. now owns 3,551,711 shares of the investment management company’s stock valued at $77,996,000 after acquiring an additional 3,167,906 shares during the period. Marshall Wace LLP purchased a new position in Ares Capital during the 3rd quarter valued at about $36,943,000. Altshuler Shaham Ltd bought a new stake in Ares Capital during the fourth quarter worth about $33,380,000. Finally, Michael & Susan Dell Foundation purchased a new stake in Ares Capital in the fourth quarter worth about $26,089,000. Institutional investors own 27.38% of the company’s stock.

Ares Capital Company Profile

Ares Capital Corporation (NASDAQ: ARCC) is a publicly traded business development company (BDC) that specializes in providing debt and equity financing solutions to U.S. middle-market companies. As a BDC, Ares Capital offers investors access to a diversified portfolio of tailored credit investments, including senior secured loans, unitranche financing, mezzanine debt and equity co-investments. The firm’s flexible capital structures are designed to support companies seeking growth capital, refinancing or strategic acquisitions.

Through its credit platform, Ares Capital focuses on originations, underwriting and portfolio management across a range of industries, with a particular emphasis on sectors such as healthcare, technology, industrials and business services.