Ares Capital (NASDAQ:ARCC) Shares Up 2.5% – Still a Buy?

Ares Capital Co. (NASDAQ:ARCC) shares rose 2.5% on Tuesday . The company traded as high as $20.33 and last traded at $19.79. Approximately 2,430,444 shares were traded during mid-day trading, a decline of 37% from the average daily volume of 3,878,706 shares. The stock had previously closed at $19.31.

Wall Street Analyst Weigh In

A number of brokerages have recently issued reports on ARCC. Raymond James cut shares of Ares Capital from an “outperform” rating to a “market perform” rating in a research note on Thursday, February 6th. JPMorgan Chase & Co. raised their price objective on Ares Capital from $23.00 to $24.50 and gave the company an “overweight” rating in a research note on Monday, February 3rd. Wells Fargo & Company lowered their target price on Ares Capital from $24.00 to $23.00 and set an “overweight” rating for the company in a research note on Thursday, February 6th. Royal Bank of Canada raised their price target on Ares Capital from $23.00 to $24.00 and gave the stock an “outperform” rating in a research report on Friday, February 7th. Finally, Keefe, Bruyette & Woods lowered their price objective on Ares Capital from $23.00 to $22.00 and set an “outperform” rating for the company in a research report on Tuesday. One research analyst has rated the stock with a sell rating, three have issued a hold rating, seven have given a buy rating and one has issued a strong buy rating to the company. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and an average target price of $22.81.

Ares Capital Stock Down 1.7 %

The company has a debt-to-equity ratio of 1.03, a current ratio of 1.21 and a quick ratio of 1.21. The stock has a market capitalization of $12.99 billion, a PE ratio of 7.73 and a beta of 0.77. The company has a 50 day moving average price of $22.55 and a 200-day moving average price of $22.02.

Ares Capital (NASDAQ:ARCC) last issued its quarterly earnings data on Wednesday, February 5th. The investment management company reported $0.55 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.58 by ($0.03). Ares Capital had a net margin of 50.90% and a return on equity of 11.54%. As a group, analysts forecast that Ares Capital Co. will post 2.19 earnings per share for the current fiscal year.

Ares Capital Dividend Announcement

The business also recently disclosed a quarterly dividend, which was paid on Monday, March 31st. Shareholders of record on Friday, March 14th were issued a $0.48 dividend. The ex-dividend date was Friday, March 14th. This represents a $1.92 annualized dividend and a yield of 10.11%. Ares Capital’s dividend payout ratio (DPR) is presently 78.37%.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently made changes to their positions in ARCC. SG Americas Securities LLC bought a new stake in shares of Ares Capital during the fourth quarter valued at approximately $519,000. Round Rock Advisors LLC bought a new stake in shares of Ares Capital during the 4th quarter valued at $1,512,000. Chicago Partners Investment Group LLC grew its position in shares of Ares Capital by 5.3% in the 4th quarter. Chicago Partners Investment Group LLC now owns 507,374 shares of the investment management company’s stock worth $11,208,000 after buying an additional 25,347 shares during the period. Franklin Resources Inc. grew its position in shares of Ares Capital by 24.3% in the 3rd quarter. Franklin Resources Inc. now owns 650,163 shares of the investment management company’s stock worth $13,900,000 after buying an additional 127,219 shares during the period. Finally, US Bancorp DE increased its stake in shares of Ares Capital by 4.7% in the 4th quarter. US Bancorp DE now owns 43,056 shares of the investment management company’s stock worth $942,000 after acquiring an additional 1,945 shares in the last quarter. Hedge funds and other institutional investors own 27.38% of the company’s stock.

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.