UBS Group Has Lowered Expectations for Ares Capital (NASDAQ:ARCC) Stock Price

Ares Capital (NASDAQ:ARCC) had its price target dropped by equities research analysts at UBS Group from $21.00 to $19.00 in a research note issued to investors on Friday,Benzinga reports. The brokerage presently has a “neutral” rating on the investment management company’s stock. UBS Group’s target price would suggest a potential upside of 6.38% from the stock’s previous close.

Several other equities research analysts also recently weighed in on the stock. Weiss Ratings reaffirmed a “hold (c+)” rating on shares of Ares Capital in a report on Monday, December 29th. Royal Bank Of Canada dropped their price target on shares of Ares Capital from $23.00 to $22.00 and set an “outperform” rating on the stock in a research report on Monday, February 9th. Wall Street Zen lowered shares of Ares Capital from a “hold” rating to a “sell” rating in a research note on Saturday, February 7th. B. Riley Financial reiterated a “buy” rating on shares of Ares Capital in a report on Monday, February 9th. Finally, JPMorgan Chase & Co. dropped their target price on Ares Capital from $22.00 to $19.00 and set an “overweight” rating on the stock in a report on Friday. Seven analysts have rated the stock with a Buy rating and two have given a Hold rating to the company. Based on data from MarketBeat, the company has an average rating of “Moderate Buy” and an average target price of $21.38.

Ares Capital Stock Performance

ARCC traded down $0.21 during trading hours on Friday, hitting $17.86. The company’s stock had a trading volume of 9,213,602 shares, compared to its average volume of 7,581,477. The company has a 50-day simple moving average of $19.74 and a 200 day simple moving average of $20.31. The company has a current ratio of 1.70, a quick ratio of 1.70 and a debt-to-equity ratio of 1.12. The firm has a market capitalization of $12.82 billion, a PE ratio of 9.60 and a beta of 0.59. Ares Capital has a fifty-two week low of $17.59 and a fifty-two week high of $23.42.

Ares Capital (NASDAQ:ARCC) last announced its quarterly earnings results on Wednesday, February 4th. The investment management company reported $0.50 earnings per share (EPS) for the quarter, hitting analysts’ consensus estimates of $0.50. Ares Capital had a return on equity of 9.89% and a net margin of 42.56%.The company had revenue of $793.00 million during the quarter, compared to analyst estimates of $795.20 million. During the same quarter in the previous year, the firm posted $0.55 EPS. The firm’s quarterly revenue was up 4.5% on a year-over-year basis. As a group, sell-side analysts expect that Ares Capital will post 2.19 EPS for the current year.

Insider Transactions at Ares Capital

In other Ares Capital news, CEO Michael Kort Schnabel bought 12,500 shares of the company’s stock in a transaction that occurred on Thursday, February 5th. The shares were acquired at an average cost of $19.13 per share, for a total transaction of $239,125.00. Following the acquisition, the chief executive officer directly owned 40,500 shares of the company’s stock, valued at $774,765. This trade represents a 44.64% increase in their ownership of the stock. The purchase was disclosed in a document filed with the SEC, which is available through this link. Also, CFO Scott C. Lem bought 5,186 shares of the business’s stock in a transaction that occurred on Friday, February 6th. The shares were acquired at an average cost 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. The trade was a 15.13% increase in their ownership of the stock. The disclosure for this purchase is available in the SEC filing. 0.48% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Institutional investors have recently modified their holdings of the stock. Canal Capital Management LLC lifted its position in shares of Ares Capital by 1.6% during the 4th quarter. Canal Capital Management LLC now owns 32,955 shares of the investment management company’s stock valued at $667,000 after acquiring an additional 520 shares during the last quarter. BKM Wealth Management LLC grew its holdings in shares of Ares Capital by 1.3% in the 3rd quarter. BKM Wealth Management LLC now owns 42,394 shares of the investment management company’s stock worth $865,000 after acquiring an additional 525 shares during the last quarter. FSC Wealth Advisors LLC raised its position in shares of Ares Capital by 10.0% during the second quarter. FSC Wealth Advisors LLC now owns 5,830 shares of the investment management company’s stock worth $128,000 after purchasing an additional 530 shares during the period. First Citizens Bank & Trust Co. lifted its holdings in shares of Ares Capital by 5.3% during the fourth quarter. First Citizens Bank & Trust Co. now owns 10,530 shares of the investment management company’s stock valued at $213,000 after purchasing an additional 532 shares during the last quarter. Finally, Perigon Wealth Management LLC lifted its holdings in shares of 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 valued at $702,000 after purchasing an additional 547 shares during the last quarter. Institutional investors own 27.38% of the company’s stock.

More Ares Capital News

Here are the key news stories impacting Ares Capital this week:

• Positive Sentiment: Analyst consensus and buy-side interest — several Wall Street analysts remain constructive on ARCC and the stock appears in lists of high-yield, passive-income names, supporting demand from income-focused investors. Wall Street Bulls Look Optimistic About Ares Capital (ARCC): Should You Buy?
• Positive Sentiment: Appeal to income investors — outlets highlighting ARCC among “passive income kings” can sustain buying interest from dividend-seeking investors given ARCC’s high yield profile. Risk-Savvy Investors Love 4 Passive Income Kings Yielding 10% and More
• Neutral Sentiment: Unusual options activity flagged — options flow was noted as unusually large; this can reflect hedging or speculative positioning but is not definitive about direction. Monitor for follow-through in volume/put-call skew. Ares Capital Target of Unusually Large Options Trading (NASDAQ:ARCC)
• Neutral Sentiment: Reported short-interest figures appear unreliable — recent short-interest posts show zeros/NaN, suggesting data issues rather than a meaningful short squeeze or ramp. Treat these entries cautiously when assessing bearish pressure. (source: internal short-interest reports)
• Negative Sentiment: Sector credit risk — coverage on “PIK” (paid-in-kind) loans warns that some borrowers are paying interest in IOUs rather than cash, a development that raises credit-risk scrutiny for business-development companies and BDC lenders like ARCC. That macro/credit concern can pressure the stock. ‘PIK’ Loans Are the Market’s Latest Concern. What They Are and Why They Matter.
• Negative Sentiment: Analyst price-target cut — JPMorgan lowered its ARCC target from $22 to $19 while keeping an overweight rating; the cut reduces upside expectations and likely weighed on sentiment. Benzinga
• Negative Sentiment: Recent intraday/near-term price weakness — market wrap pieces reporting a multi-percent intraday decline likely amplified selling momentum as investors digested the above negative signals. Ares Capital (ARCC) Registers a Bigger Fall Than the Market: Important Facts to Note

About Ares Capital

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.