Calton & Associates Inc. Takes Position in Ares Capital Corporation $ARCC

Key Points

• Calton & Associates Inc. has acquired a new stake in Ares Capital Corporation (NASDAQ:ARCC), purchasing 13,554 shares valued at approximately $300,000 in the first quarter.
• Recent analyst reports indicate a positive outlook for Ares Capital, with multiple firms increasing their target prices, including Keefe, Bruyette & Woods and Wells Fargo, both raising their target to $23.00.
• Ares Capital has declared a quarterly dividend of $0.48 per share, which corresponds to an annualized yield of 8.6%.

Calton & Associates Inc. bought a new stake in Ares Capital Corporation (NASDAQ:ARCC - Free Report) during the first quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The firm bought 13,554 shares of the investment management company's stock, valued at approximately $300,000.

A number of other hedge funds and other institutional investors have also recently added to or reduced their stakes in ARCC. HighTower Advisors LLC boosted its holdings in Ares Capital by 87.2% in the first quarter. HighTower Advisors LLC now owns 2,621,109 shares of the investment management company's stock valued at $58,084,000 after acquiring an additional 1,220,570 shares during the last quarter. Two Sigma Investments LP boosted its holdings in Ares Capital by 81.0% in the fourth quarter. Two Sigma Investments LP now owns 2,678,525 shares of the investment management company's stock valued at $58,633,000 after acquiring an additional 1,198,580 shares during the last quarter. Bank of America Corp DE lifted its stake in shares of Ares Capital by 12.3% during the fourth quarter. Bank of America Corp DE now owns 7,951,926 shares of the investment management company's stock worth $174,068,000 after purchasing an additional 871,370 shares in the last quarter. Two Sigma Advisers LP lifted its stake in shares of Ares Capital by 189.6% during the fourth quarter. Two Sigma Advisers LP now owns 1,302,501 shares of the investment management company's stock worth $28,512,000 after purchasing an additional 852,801 shares in the last quarter. Finally, CCLA Investment Management lifted its stake in shares of Ares Capital by 26.5% during the first quarter. CCLA Investment Management now owns 2,799,023 shares of the investment management company's stock worth $62,026,000 after purchasing an additional 587,068 shares in the last quarter. Institutional investors and hedge funds own 27.38% of the company's stock.

Ares Capital Stock Up 0.2%

Ares Capital stock traded up $0.05 during midday trading on Thursday, hitting $22.37. The stock had a trading volume of 3,382,179 shares, compared to its average volume of 4,416,195. The company has a current ratio of 1.14, a quick ratio of 1.14 and a debt-to-equity ratio of 1.01. The stock has a market cap of $15.78 billion, a P/E ratio of 10.91 and a beta of 0.70. Ares Capital Corporation has a 12 month low of $18.26 and a 12 month high of $23.84. The business has a fifty day moving average price of $22.51 and a 200 day moving average price of $21.92.

Ares Capital (NASDAQ:ARCC - Get Free Report) last announced its quarterly earnings data on Tuesday, July 29th. The investment management company reported $0.50 earnings per share for the quarter, missing the consensus estimate of $0.51 by ($0.01). The firm had revenue of $614.00 million during the quarter, compared to the consensus estimate of $748.76 million. Ares Capital had a net margin of 44.94% and a return on equity of 10.48%. During the same period in the prior year, the firm earned $0.61 earnings per share. Research analysts predict that Ares Capital Corporation will post 2.19 EPS for the current year.

Ares Capital Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Tuesday, September 30th. Investors of record on Monday, September 15th will be issued a $0.48 dividend. This represents a $1.92 annualized dividend and a yield of 8.6%. The ex-dividend date of this dividend is Monday, September 15th. Ares Capital's payout ratio is currently 93.66%.

Wall Street Analyst Weigh In

A number of brokerages have commented on ARCC. Wells Fargo & Company boosted their price objective on Ares Capital from $22.00 to $23.00 and gave the stock an "overweight" rating in a research note on Wednesday, July 30th. Citigroup restated an "outperform" rating on shares of Ares Capital in a research note on Thursday, July 31st. B. Riley upgraded Ares Capital from a "neutral" rating to a "buy" rating and boosted their price objective for the stock from $22.50 to $23.50 in a research note on Wednesday, July 30th. UBS Group boosted their price objective on Ares Capital from $22.00 to $22.50 and gave the stock a "neutral" rating in a research note on Wednesday, July 16th. Finally, JMP Securities set a $23.00 price objective on Ares Capital and gave the stock a "market outperform" rating in a research note on Thursday, July 31st. Seven equities research analysts have rated the stock with a Buy rating and two have given a Hold rating to the stock. Based on data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and an average price target of $22.86.

Ares Capital 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.