Legal & General Group Plc Buys New Position in Ares Capital Corporation $ARCC

Key Points

• Legal & General Group acquired 6.51 million Ares Capital shares worth approximately $120.5 million, giving it a 0.91% stake; institutional investors collectively own 27.38% of ARCC.
• Ares Capital reported quarterly EPS of $0.47, matching analyst estimates, while revenue reached $768 million. The company declared a quarterly dividend of $0.48 per share, representing a 9.7% annualized yield.
• ARCC trades near $19.88, with analysts assigning a “Moderate Buy” consensus rating and an average price target of $20.40, despite several recent target-price reductions.

Legal & General Group Plc bought a new stake in shares of Ares Capital Corporation (NASDAQ:ARCC - Free Report) in the second quarter, according to its most recent disclosure with the Securities & Exchange Commission. The institutional investor bought 6,510,302 shares of the investment management company's stock, valued at approximately $120,538,000. Legal & General Group Plc owned about 0.91% of Ares Capital at the end of the most recent quarter.

Several other institutional investors have also added to or reduced their stakes in the business. Morgan Stanley grew its position in shares of Ares Capital by 2.0% during the 4th quarter. Morgan Stanley now owns 17,558,581 shares of the investment management company's stock valued at $355,210,000 after acquiring an additional 341,578 shares during the period. Strs Ohio bought a new position in Ares Capital in the 1st quarter worth $189,210,000. Bank of America Corp DE raised its holdings in Ares Capital by 16.0% in the 1st quarter. Bank of America Corp DE now owns 9,135,454 shares of the investment management company's stock worth $164,621,000 after purchasing an additional 1,259,230 shares during the period. UBS Group AG lifted its position in Ares Capital by 11.8% during the third quarter. UBS Group AG now owns 7,900,015 shares of the investment management company's stock valued at $161,239,000 after purchasing an additional 836,826 shares in the last quarter. Finally, Wells Fargo & Company MN lifted its position in Ares Capital by 1.5% during the fourth quarter. Wells Fargo & Company MN now owns 4,387,637 shares of the investment management company's stock valued at $88,762,000 after purchasing an additional 63,796 shares in the last quarter. 27.38% of the stock is currently owned by institutional investors.

Ares Capital Stock Down 0.1%

ARCC opened at $19.88 on Friday. The stock has a market cap of $14.27 billion, a price-to-earnings ratio of 14.73 and a beta of 0.56. The company has a debt-to-equity ratio of 1.14, a quick ratio of 1.28 and a current ratio of 1.28. The firm's fifty day moving average is $19.06 and its 200 day moving average is $18.83. Ares Capital Corporation has a fifty-two week low of $17.40 and a fifty-two week high of $22.51.

Ares Capital (NASDAQ:ARCC - Get Free Report) last issued its quarterly earnings results on Wednesday, July 29th. The investment management company reported $0.47 earnings per share (EPS) for the quarter, hitting analysts' consensus estimates of $0.47. The business had revenue of $768.00 million during the quarter, compared to analyst estimates of $770.19 million. Ares Capital had a return on equity of 9.80% and a net margin of 30.91%.During the same quarter in the prior year, the business posted $0.50 EPS. On average, sell-side analysts forecast that Ares Capital Corporation will post 1.91 earnings per share for the current fiscal year.

Ares Capital Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, September 30th. Investors of record on Tuesday, September 15th will be given a dividend of $0.48 per share. The ex-dividend date is Tuesday, September 15th. This represents a $1.92 annualized dividend and a dividend yield of 9.7%. Ares Capital's dividend payout ratio (DPR) is currently 142.22%.

Analysts Set New Price Targets

ARCC has been the subject of a number of analyst reports. Wells Fargo & Company restated an "equal weight" rating and issued a $19.00 price target (down from $20.00) on shares of Ares Capital in a research report on Friday, June 12th. Wall Street Zen cut Ares Capital from a "hold" rating to a "sell" rating in a research report on Sunday, August 2nd. JPMorgan Chase & Co. lowered their price objective on Ares Capital from $19.00 to $18.50 and set an "overweight" rating on the stock in a research report on Thursday, July 2nd. Weiss Ratings reiterated a "hold (c)" rating on shares of Ares Capital in a research note on Tuesday, June 9th. Finally, Truist Financial reduced their target price on shares of Ares Capital from $22.00 to $21.00 and set a "buy" rating for the company in a report on Thursday, July 30th. Eight research analysts have rated the stock with a Buy rating and three have given a Hold rating to the company. Based on data from MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average price target of $20.40.

Ares Capital Company 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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