Ares Capital Corporation (NASDAQ:ARCC) Given Consensus Rating of "Moderate Buy" by Analysts

Key Points

• Ares Capital has a consensus analyst rating of “Moderate Buy”, with 9 buy ratings and 2 hold ratings from the 11 brokerages covering the stock. The average 1-year price target is $20.75.
• Several firms recently cut their price targets on ARCC, including UBS, JPMorgan, Oppenheimer, Truist, and Citizens JMP, though most maintained positive ratings such as buy or outperform.
• The company recently reported quarterly EPS of $0.47, slightly below estimates, and announced a $0.48 quarterly dividend, equal to a 10.1% annualized yield.

Ares Capital Corporation (NASDAQ:ARCC - Get Free Report) has been assigned a consensus rating of "Moderate Buy" from the eleven brokerages that are currently covering the company, Marketbeat reports. Two investment analysts have rated the stock with a hold recommendation and nine have assigned a buy recommendation to the company. The average 1 year price target among brokers that have issued ratings on the stock in the last year is $20.75.

Several research firms recently commented on ARCC. UBS Group reduced their target price on shares of Ares Capital from $21.00 to $19.00 and set a "neutral" rating on the stock in a report on Friday, March 13th. Oppenheimer lowered their target price on Ares Capital from $22.00 to $21.00 and set an "outperform" rating for the company in a research note on Wednesday, April 29th. JPMorgan Chase & Co. lowered their target price on Ares Capital from $22.00 to $19.00 and set an "overweight" rating for the company in a research note on Friday, March 13th. Truist Financial lowered their target price on Ares Capital from $23.00 to $22.00 and set a "buy" rating for the company in a research note on Wednesday, April 29th. Finally, Citizens Jmp lowered their target price on Ares Capital from $23.00 to $22.00 and set a "market outperform" rating for the company in a research note on Wednesday, April 22nd.

Institutional Trading of Ares Capital

Hedge funds and other institutional investors have recently modified their holdings of the business. Canal Capital Management LLC lifted its holdings in shares of Ares Capital by 1.6% during the fourth quarter. Canal Capital Management LLC now owns 32,955 shares of the investment management company's stock valued at $667,000 after purchasing an additional 520 shares during the last quarter. Roman Butler Fullerton & Co. lifted its holdings in shares of Ares Capital by 1.9% during the first quarter. Roman Butler Fullerton & Co. now owns 27,713 shares of the investment management company's stock valued at $504,000 after purchasing an additional 528 shares during the last quarter. First Citizens Bank & Trust Co. increased its holdings in shares of Ares Capital by 5.3% during the fourth quarter. First Citizens Bank & Trust Co. now owns 10,530 shares of the investment management company's stock valued at $213,000 after acquiring an additional 532 shares in the last quarter. Perigon Wealth Management LLC raised its position in shares of Ares Capital by 1.6% in the 4th quarter. Perigon Wealth Management LLC now owns 34,700 shares of the investment management company's stock worth $702,000 after purchasing an additional 547 shares during the last quarter. Finally, Balboa Wealth Partners raised its position in shares of Ares Capital by 1.3% in the 3rd quarter. Balboa Wealth Partners now owns 44,755 shares of the investment management company's stock worth $913,000 after purchasing an additional 559 shares during the last quarter. 27.38% of the stock is owned by hedge funds and other institutional investors.

Ares Capital Trading Up 0.3%

Shares of ARCC opened at $19.01 on Friday. The firm's 50 day simple moving average is $18.51 and its 200 day simple moving average is $19.59. The company has a market capitalization of $13.65 billion, a P/E ratio of 11.66 and a beta of 0.58. The company has a debt-to-equity ratio of 1.13, a current ratio of 1.40 and a quick ratio of 1.40. Ares Capital has a 1-year low of $17.40 and a 1-year high of $23.42.

Ares Capital (NASDAQ:ARCC - Get Free Report) last issued its quarterly earnings results on Tuesday, April 28th. The investment management company reported $0.47 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.48 by ($0.01). Ares Capital had a return on equity of 9.85% and a net margin of 37.30%.The firm had revenue of $763.00 million for the quarter, compared to the consensus estimate of $778.00 million. During the same period last year, the firm earned $0.50 EPS. The company's revenue for the quarter was up 4.2% on a year-over-year basis. Sell-side analysts forecast that Ares Capital will post 1.91 earnings per share for the current fiscal year.

Ares Capital Announces Dividend

The firm also recently declared a quarterly dividend, which will be paid on Tuesday, June 30th. Investors of record on Monday, June 15th will be issued a dividend of $0.48 per share. This represents a $1.92 dividend on an annualized basis and a yield of 10.1%. The ex-dividend date is Monday, June 15th. Ares Capital's payout ratio is currently 117.79%.

About Ares Capital

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.

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