Ares Capital (NASDAQ:ARCC) Stock Rating Lowered by Wall Street Zen

Key Points

• Ares Capital has been downgraded by Wall Street Zen from a "hold" to a "sell" rating, signaling negative sentiment from analysts.
• Despite the downgrade, Keefe, Bruyette & Woods and other firms have issued varying analyses, with some maintaining "buy" or "outperform" ratings and increasing price targets.
• The company reported earnings of $0.50 per share, missing estimates by $0.01, along with a significant revenue shortfall compared to expectations, indicating potential concerns about its financial performance.

Ares Capital (NASDAQ:ARCC - Get Free Report) was downgraded by equities research analysts at Wall Street Zen from a "hold" rating to a "sell" rating in a research report issued to clients and investors on Saturday.

Several other research firms have also issued reports on ARCC. Keefe, Bruyette & Woods upped their price target on shares of Ares Capital from $22.00 to $23.00 and gave the company an "outperform" rating in a research report on Wednesday, July 30th. UBS Group increased their target price on shares of Ares Capital from $22.00 to $22.50 and gave the stock a "neutral" rating in a report on Wednesday, July 16th. Capital One Financial set a $22.50 target price on shares of Ares Capital in a report on Friday. B. Riley upgraded shares of Ares Capital from a "neutral" rating to a "buy" rating and increased their target price for the stock from $22.50 to $23.50 in a report on Wednesday, July 30th. Finally, Citigroup reiterated an "outperform" rating on shares of Ares Capital in a report on Thursday, July 31st. Eight investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company. According to MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $22.81.

Ares Capital Stock Performance

NASDAQ ARCC opened at $18.90 on Friday. The company has a 50-day simple moving average of $21.61 and a two-hundred day simple moving average of $21.63. The company has a quick ratio of 1.14, a current ratio of 1.14 and a debt-to-equity ratio of 1.01. Ares Capital has a 12-month low of $18.26 and a 12-month high of $23.84. The firm has a market cap of $13.33 billion, a price-to-earnings ratio of 9.22 and a beta of 0.68.

Ares Capital (NASDAQ:ARCC - Get Free Report) last posted its quarterly earnings results on Tuesday, July 29th. The investment management company reported $0.50 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.51 by ($0.01). Ares Capital had a net margin of 44.94% and a return on equity of 10.48%. The business had revenue of $614.00 million for the quarter, compared to analysts' expectations of $748.76 million. During the same quarter in the previous year, the company earned $0.61 earnings per share. On average, equities analysts forecast that Ares Capital will post 2.19 EPS for the current year.

Hedge Funds Weigh In On Ares Capital

Institutional investors have recently bought and sold shares of the stock. Spinnaker Investment Group LLC bought a new position in shares of Ares Capital during the third quarter valued at approximately $557,000. Sound Income Strategies LLC increased its stake in shares of Ares Capital by 1.0% during the third quarter. Sound Income Strategies LLC now owns 2,477,932 shares of the investment management company's stock valued at $47,329,000 after purchasing an additional 23,988 shares in the last quarter. Astoria Portfolio Advisors LLC. increased its stake in shares of Ares Capital by 11.9% during the third quarter. Astoria Portfolio Advisors LLC. now owns 10,024 shares of the investment management company's stock valued at $197,000 after purchasing an additional 1,063 shares in the last quarter. Chapin Davis Inc. increased its stake in shares of Ares Capital by 11.6% during the third quarter. Chapin Davis Inc. now owns 11,141 shares of the investment management company's stock valued at $227,000 after purchasing an additional 1,160 shares in the last quarter. Finally, Vista Finance LLC increased its stake in shares of Ares Capital by 3.9% during the third quarter. Vista Finance LLC now owns 606,745 shares of the investment management company's stock valued at $12,384,000 after purchasing an additional 22,943 shares in the last quarter. 27.38% of the stock is owned by institutional investors.

Ares Capital Company Profile

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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