Royal Bank of Canada Reiterates “Outperform” Rating for Ares Capital (NASDAQ:ARCC)

Royal Bank of Canada reissued their outperform rating on shares of Ares Capital (NASDAQ:ARCC) in a research note released on Thursday, Benzinga reports. The brokerage currently has a $22.00 price target on the investment management company’s stock.

A number of other research firms have also recently weighed in on ARCC. Wells Fargo & Company lifted their price objective on shares of Ares Capital from $19.00 to $20.00 and gave the company an equal weight rating in a report on Monday, January 29th. Truist Financial upped their price target on Ares Capital from $22.00 to $23.00 and gave the stock a buy rating in a report on Thursday, May 2nd. JPMorgan Chase & Co. increased their price target on Ares Capital from $21.50 to $22.00 and gave the stock an overweight rating in a research report on Thursday, May 2nd. Oppenheimer boosted their price objective on Ares Capital from $21.00 to $22.00 and gave the company an outperform rating in a research report on Thursday, May 2nd. Finally, JMP Securities reiterated a market outperform rating and set a $21.00 target price on shares of Ares Capital in a research report on Tuesday, March 26th. Three equities research analysts have rated the stock with a hold rating and five have assigned a buy rating to the company. According to data from MarketBeat.com, Ares Capital has a consensus rating of Moderate Buy and an average price target of $21.50.

Ares Capital Stock Performance

Shares of ARCC stock opened at $21.35 on Thursday. Ares Capital has a 52-week low of $18.00 and a 52-week high of $21.53. The company has a quick ratio of 1.63, a current ratio of 1.63 and a debt-to-equity ratio of 0.99. The stock has a market cap of $13.12 billion, a PE ratio of 7.31 and a beta of 0.99. The business has a 50-day simple moving average of $20.66 and a 200-day simple moving average of $20.29.

Ares Capital (NASDAQ:ARCC) last announced its quarterly earnings results on Wednesday, May 1st. The investment management company reported $0.59 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.60 by ($0.01). The company had revenue of $701.00 million during the quarter, compared to analyst estimates of $703.85 million. Ares Capital had a net margin of 62.77% and a return on equity of 12.37%. The company’s revenue was up 13.4% compared to the same quarter last year. During the same period in the previous year, the firm posted $0.56 earnings per share. On average, equities analysts expect that Ares Capital will post 2.34 EPS for the current year.

Ares Capital Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Friday, June 28th. Investors of record on Friday, June 14th will be given a dividend of $0.48 per share. This represents a $1.92 annualized dividend and a dividend yield of 8.99%. The ex-dividend date is Friday, June 14th. Ares Capital’s payout ratio is 65.75%.

Institutional Investors Weigh In On Ares Capital

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Lewis Asset Management LLC lifted its stake in shares of Ares Capital by 2.1% in the first quarter. Lewis Asset Management LLC now owns 24,805 shares of the investment management company’s stock worth $516,000 after buying an additional 500 shares in the last quarter. Chapin Davis Inc. boosted its holdings in shares of Ares Capital by 2.2% during the 1st quarter. Chapin Davis Inc. now owns 22,966 shares of the investment management company’s stock worth $478,000 after purchasing an additional 501 shares during the last quarter. Lincoln National Corp grew its position in shares of Ares Capital by 3.0% in the fourth quarter. Lincoln National Corp now owns 17,665 shares of the investment management company’s stock valued at $354,000 after purchasing an additional 520 shares in the last quarter. Baron Financial Group LLC increased its holdings in shares of Ares Capital by 3.0% in the fourth quarter. Baron Financial Group LLC now owns 18,366 shares of the investment management company’s stock valued at $368,000 after purchasing an additional 543 shares during the last quarter. Finally, Transcend Capital Advisors LLC lifted its position in Ares Capital by 0.5% during the fourth quarter. Transcend Capital Advisors LLC now owns 108,577 shares of the investment management company’s stock worth $2,175,000 after buying an additional 557 shares in the last quarter. Institutional investors and hedge funds own 27.38% of the company’s stock.

About Ares Capital

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.