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

Key Points

• Ares Capital currently carries a consensus analyst rating of “Moderate Buy”, based on coverage from 11 firms. Eight analysts rate it a buy, three a hold, and the average 12-month price target is $20.60.
• The stock last traded at $18.61, below the average price target, and the company has a market cap of about $13.36 billion with a low beta of 0.56. Its shares have ranged from $17.40 to $23.16 over the past year.
• Ares Capital recently reported quarterly EPS of $0.47, slightly below estimates, while revenue came in at $763 million, also under expectations. The company also paid a quarterly dividend of $0.48 per share, implying an annualized yield of 10.3%.

Shares of Ares Capital Corporation (NASDAQ:ARCC - Get Free Report) have earned a consensus rating of "Moderate Buy" from the eleven research firms that are currently covering the stock, Marketbeat Ratings reports. Three investment analysts have rated the stock with a hold rating and eight have assigned a buy rating to the company. The average 12 month target price among analysts that have issued a report on the stock in the last year is $20.60.

Several research firms have recently commented on ARCC. JPMorgan Chase & Co. decreased their price target on shares of Ares Capital from $19.00 to $18.50 and set an "overweight" rating for the company in a report on Thursday, July 2nd. Citizens Jmp dropped their price objective on shares of Ares Capital from $23.00 to $22.00 and set a "market outperform" rating on the stock in a research note on Wednesday, April 22nd. Weiss Ratings reissued a "hold (c)" rating on shares of Ares Capital in a report on Tuesday, June 9th. Wells Fargo & Company restated an "equal weight" rating and issued a $19.00 target price (down from $20.00) on shares of Ares Capital in a research note on Friday, June 12th. Finally, Keefe, Bruyette & Woods lowered their target price on Ares Capital from $22.00 to $21.00 and set an "outperform" rating for the company in a report on Thursday, April 16th.

Ares Capital Stock Performance

Shares of ARCC opened at $18.61 on Friday. The stock has a market capitalization of $13.36 billion, a PE ratio of 11.42 and a beta of 0.56. The business's fifty day moving average price is $18.66 and its 200 day moving average price is $18.97. 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 12-month low of $17.40 and a 12-month high of $23.16.

Ares Capital (NASDAQ:ARCC - Get Free Report) last released its earnings results on Tuesday, April 28th. The investment management company reported $0.47 earnings per share for the quarter, missing the consensus estimate of $0.48 by ($0.01). The business had revenue of $763.00 million for the quarter, compared to the consensus estimate of $778.00 million. Ares Capital had a net margin of 37.30% and a return on equity of 9.85%. The firm's revenue for the quarter was up 4.2% on a year-over-year basis. During the same quarter in the previous year, the firm earned $0.50 EPS. Equities research analysts forecast that Ares Capital will post 1.9 EPS for the current year.

Ares Capital Announces Dividend

The business also recently disclosed a quarterly dividend, which was paid on Tuesday, June 30th. Investors of record on Monday, June 15th were given a dividend of $0.48 per share. The ex-dividend date was Monday, June 15th. This represents a $1.92 dividend on an annualized basis and a yield of 10.3%. Ares Capital's payout ratio is currently 117.79%.

Institutional Inflows and Outflows

A number of institutional investors have recently added to or reduced their stakes in the stock. AQR Capital Management LLC increased its holdings in shares of Ares Capital by 6.5% in the 1st quarter. AQR Capital Management LLC now owns 16,502 shares of the investment management company's stock worth $365,000 after acquiring an additional 1,000 shares during the period. Dynamic Technology Lab Private Ltd bought a new stake in shares of Ares Capital during the first quarter valued at approximately $273,000. Goldman Sachs Group Inc. boosted its position in shares of Ares Capital by 14.5% during the first quarter. Goldman Sachs Group Inc. now owns 2,835,007 shares of the investment management company's stock worth $62,824,000 after buying an additional 358,829 shares during the period. Empowered Funds LLC grew its holdings in Ares Capital by 139.9% in the 1st quarter. Empowered Funds LLC now owns 27,655 shares of the investment management company's stock worth $613,000 after buying an additional 16,128 shares in the last quarter. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC bought a new stake in Ares Capital during the 1st quarter valued at $14,766,000. 27.38% of the stock is currently owned by institutional investors.

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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