Ares Capital Co. (NASDAQ:ARCC - Get Free Report)'s stock price fell 3.1% during trading on Tuesday following a dissappointing earnings announcement. The company traded as low as $20.57 and last traded at $20.58. 2,192,321 shares changed hands during trading, a decline of 46% from the average session volume of 4,086,413 shares. The stock had previously closed at $21.25.
The investment management company reported $0.50 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.54 by ($0.04). Ares Capital had a net margin of 50.90% and a return on equity of 11.54%. The firm had revenue of $599.00 million during the quarter, compared to analysts' expectations of $769.32 million. During the same period in the previous year, the firm earned $0.59 EPS. The firm's revenue for the quarter was up 4.4% compared to the same quarter last year.
Ares Capital Announces Dividend
The company also recently announced a quarterly dividend, which will be paid on Monday, June 30th. Shareholders of record on Friday, June 13th will be given a $0.48 dividend. This represents a $1.92 annualized dividend and a yield of 9.23%. The ex-dividend date of this dividend is Friday, June 13th. Ares Capital's dividend payout ratio is currently 78.37%.
Wall Street Analysts Forecast Growth
A number of research analysts recently weighed in on the stock. Raymond James cut shares of Ares Capital from an "outperform" rating to a "market perform" rating in a report on Thursday, February 6th. UBS Group dropped their price target on shares of Ares Capital from $22.00 to $21.00 and set a "neutral" rating for the company in a research note on Thursday, April 17th. Royal Bank of Canada increased their price objective on Ares Capital from $23.00 to $24.00 and gave the company an "outperform" rating in a research note on Friday, February 7th. StockNews.com cut Ares Capital from a "hold" rating to a "sell" rating in a research note on Friday, February 7th. Finally, JPMorgan Chase & Co. decreased their price objective on Ares Capital from $24.50 to $22.00 and set an "overweight" rating for the company in a research note on Thursday, April 24th. One research analyst has rated the stock with a sell rating, three have issued a hold rating, seven have assigned a buy rating and one has issued a strong buy rating to the company's stock. According to MarketBeat.com, Ares Capital currently has an average rating of "Moderate Buy" and an average target price of $22.22.
Check Out Our Latest Stock Analysis on Ares Capital
Hedge Funds Weigh In On Ares Capital
Several hedge funds have recently added to or reduced their stakes in ARCC. Independent Wealth Network Inc. grew its position in shares of Ares Capital by 4.8% in the 1st quarter. Independent Wealth Network Inc. now owns 49,774 shares of the investment management company's stock valued at $1,103,000 after buying an additional 2,269 shares during the last quarter. Kingsview Wealth Management LLC increased its position in shares of Ares Capital by 2.0% during the first quarter. Kingsview Wealth Management LLC now owns 80,691 shares of the investment management company's stock worth $1,788,000 after purchasing an additional 1,604 shares in the last quarter. Verdence Capital Advisors LLC lifted its holdings in shares of Ares Capital by 9.3% in the 1st quarter. Verdence Capital Advisors LLC now owns 11,828 shares of the investment management company's stock valued at $262,000 after purchasing an additional 1,002 shares during the last quarter. Midwest Professional Planners LTD. boosted its holdings in shares of Ares Capital by 6.4% in the first quarter. Midwest Professional Planners LTD. now owns 54,978 shares of the investment management company's stock valued at $1,218,000 after acquiring an additional 3,313 shares during the period. Finally, Tectonic Advisors LLC increased its holdings in shares of Ares Capital by 7.5% in the 1st quarter. Tectonic Advisors LLC now owns 467,953 shares of the investment management company's stock valued at $10,370,000 after acquiring an additional 32,733 shares during the period. 27.38% of the stock is currently owned by hedge funds and other institutional investors.
Ares Capital Stock Performance
The company has a debt-to-equity ratio of 1.03, a quick ratio of 1.21 and a current ratio of 1.21. The stock has a market cap of $14.24 billion, a PE ratio of 8.49 and a beta of 0.77. The firm's 50-day moving average is $21.34 and its 200 day moving average is $21.92.
About Ares Capital
(
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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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