D.A. Davidson & CO. Decreases Position in Ares Capital Corporation $ARCC

Key Points

• D.A. Davidson & CO. trimmed its stake in Ares Capital by 31.4%, selling 282,224 shares and retaining 617,702 shares valued at about $12.5 million.
• Insiders increased exposure: CFO Scott C. Lem bought 5,186 shares (a 15.13% increase) and CEO Michael Kort Schnabel bought 12,500 shares (a 44.64% increase).
• Ares Capital pays a quarterly dividend of $0.48 (annualized $1.92) for a yield of 10.3%103%, which may raise sustainability concerns.

D.A. Davidson & CO. trimmed its position in shares of Ares Capital Corporation (NASDAQ:ARCC - Free Report) by 31.4% during the fourth quarter, according to the company in its most recent Form 13F filing with the SEC. The institutional investor owned 617,702 shares of the investment management company's stock after selling 282,224 shares during the quarter. D.A. Davidson & CO. owned approximately 0.09% of Ares Capital worth $12,496,000 at the end of the most recent reporting period.

A number of other institutional investors also recently bought and sold shares of the company. Canal Capital Management LLC boosted its position in 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 worth $667,000 after purchasing an additional 520 shares in the last quarter. BKM Wealth Management LLC boosted its position in Ares Capital by 1.3% during the third quarter. BKM Wealth Management LLC now owns 42,394 shares of the investment management company's stock worth $865,000 after purchasing an additional 525 shares in the last quarter. Perigon Wealth Management LLC boosted its position in Ares Capital by 1.6% during the fourth 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 in the last quarter. Balboa Wealth Partners boosted its position in Ares Capital by 1.3% during the third 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 in the last quarter. Finally, Diversify Advisory Services LLC boosted its position in Ares Capital by 2.0% during the fourth quarter. Diversify Advisory Services LLC now owns 28,186 shares of the investment management company's stock worth $589,000 after purchasing an additional 563 shares in the last quarter. 27.38% of the stock is currently owned by hedge funds and other institutional investors.

Wall Street Analysts Forecast Growth

Several analysts have issued reports on the stock. Royal Bank Of Canada reduced their price target on shares of Ares Capital from $23.00 to $22.00 and set an "outperform" rating on the stock in a report on Monday, February 9th. Citizens Jmp reduced their price target on shares of Ares Capital from $23.00 to $22.00 and set a "market outperform" rating on the stock in a report on Wednesday, April 22nd. Weiss Ratings reaffirmed a "hold (c+)" rating on shares of Ares Capital in a report on Monday, December 29th. Wall Street Zen downgraded shares of Ares Capital from a "hold" rating to a "sell" rating in a report on Saturday, February 7th. Finally, B. Riley Financial reaffirmed a "buy" rating on shares of Ares Capital in a report on Monday, February 9th. Seven equities research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and an average price target of $21.13.

Insider Activity at Ares Capital

In other news, CFO Scott C. Lem acquired 5,186 shares of Ares Capital stock in a transaction that occurred on Friday, February 6th. The shares were acquired at an average price of $19.29 per share, with a total value of $100,037.94. Following the completion of the purchase, the chief financial officer owned 39,463 shares of the company's stock, valued at approximately $761,241.27. This represents a 15.13% increase in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, CEO Michael Kort Schnabel acquired 12,500 shares of Ares Capital stock in a transaction that occurred on Thursday, February 5th. The shares were purchased at an average cost of $19.13 per share, for a total transaction of $239,125.00. Following the purchase, the chief executive officer directly owned 40,500 shares of the company's stock, valued at approximately $774,765. This trade represents a 44.64% increase in their position. The SEC filing for this purchase provides additional information. Corporate insiders own 0.49% of the company's stock.

Ares Capital Stock Down 0.3%

Shares of NASDAQ:ARCC opened at $18.61 on Tuesday. The company has a quick ratio of 1.70, a current ratio of 1.70 and a debt-to-equity ratio of 1.12. Ares Capital Corporation has a 52-week low of $17.40 and a 52-week high of $23.42. The stock's fifty day simple moving average is $18.53 and its 200-day simple moving average is $19.61. The company has a market capitalization of $13.36 billion, a P/E ratio of 10.01 and a beta of 0.58.

Ares Capital (NASDAQ:ARCC - Get Free Report) last issued its quarterly earnings data on Wednesday, February 4th. The investment management company reported $0.50 earnings per share (EPS) for the quarter, meeting the consensus estimate of $0.50. Ares Capital had a return on equity of 9.89% and a net margin of 42.56%.The business had revenue of $793.00 million for the quarter, compared to the consensus estimate of $795.20 million. During the same period in the prior year, the business earned $0.55 earnings per share. The business's revenue was up 4.5% on a year-over-year basis. As a group, equities research analysts forecast that Ares Capital Corporation will post 1.93 earnings per share for the current fiscal year.

Ares Capital Announces Dividend

The company also recently disclosed a quarterly dividend, which was paid on Tuesday, March 31st. Investors of record on Friday, March 13th were paid a dividend of $0.48 per share. The ex-dividend date of this dividend was Friday, March 13th. This represents a $1.92 annualized dividend and a dividend yield of 10.3%. Ares Capital's dividend payout ratio is presently 103.23%.

Ares Capital Profile

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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