Ares Capital (NASDAQ:ARCC) Trading 0.4% Higher – Still a Buy?

Ares Capital Co. (NASDAQ:ARCC) shares shot up 0.4% on Friday . The company traded as high as $21.22 and last traded at $21.22. 284,314 shares were traded during trading, a decline of 92% from the average session volume of 3,421,468 shares. The stock had previously closed at $21.13.

Wall Street Analyst Weigh In

Several analysts have commented on ARCC shares. Compass Point upgraded shares of Ares Capital to a “strong-buy” rating in a report on Tuesday, July 30th. JMP Securities lifted their price target on Ares Capital from $21.00 to $22.00 and gave the company a “market outperform” rating in a research report on Tuesday, July 30th. Royal Bank of Canada restated an “outperform” rating and set a $22.00 target price on shares of Ares Capital in a report on Monday, August 5th. Finally, UBS Group upgraded shares of Ares Capital to a “hold” rating in a research note on Friday, August 23rd. Three research analysts have rated the stock with a hold rating, five have given a buy rating and one has issued a strong buy rating to the company. According to MarketBeat, the company has an average rating of “Moderate Buy” and an average price target of $21.71.

Ares Capital Price Performance

The firm has a 50-day moving average of $20.71 and a 200-day moving average of $20.83. The company has a debt-to-equity ratio of 1.05, a quick ratio of 1.40 and a current ratio of 1.40. The firm has a market capitalization of $13.42 billion, a P/E ratio of 7.46 and a beta of 1.01.

Ares Capital (NASDAQ:ARCC) last posted its earnings results on Tuesday, July 30th. The investment management company reported $0.61 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.58 by $0.03. Ares Capital had a net margin of 59.76% and a return on equity of 12.24%. The business had revenue of $755.00 million for the quarter, compared to analysts’ expectations of $714.27 million. During the same quarter in the prior year, the business earned $0.58 EPS. As a group, analysts predict that Ares Capital Co. will post 2.39 EPS for the current year.

Ares Capital Announces Dividend

The company also recently disclosed a quarterly dividend, which was paid on Monday, September 30th. Investors of record on Friday, September 13th were issued a $0.48 dividend. This represents a $1.92 annualized dividend and a dividend yield of 9.02%. The ex-dividend date of this dividend was Friday, September 13th. Ares Capital’s payout ratio is currently 67.37%.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in ARCC. Confluence Investment Management LLC bought a new position in shares of Ares Capital during the 1st quarter valued at approximately $86,227,000. Van ECK Associates Corp raised its stake in Ares Capital by 20.2% during the 2nd quarter. Van ECK Associates Corp now owns 11,681,109 shares of the investment management company’s stock worth $243,434,000 after acquiring an additional 1,961,166 shares during the period. Cetera Investment Advisers raised its stake in Ares Capital by 143.9% during the 1st quarter. Cetera Investment Advisers now owns 820,390 shares of the investment management company’s stock worth $17,081,000 after acquiring an additional 484,088 shares during the period. Magnolia Capital Advisors LLC bought a new stake in Ares Capital during the 2nd quarter worth approximately $9,815,000. Finally, 1832 Asset Management L.P. raised its stake in Ares Capital by 52.7% during the 1st quarter. 1832 Asset Management L.P. now owns 1,354,097 shares of the investment management company’s stock worth $28,192,000 after acquiring an additional 467,535 shares during the period. 27.38% of the stock is currently 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.