Ares Capital Target of Unusually Large Options Trading (NASDAQ:ARCC)

Ares Capital Corporation (NASDAQ:ARCC) was the target of some unusual options trading on Tuesday. Stock traders acquired 11,684 put options on the stock. This is an increase of 99% compared to the average volume of 5,885 put options.

Ares Capital Price Performance

NASDAQ:ARCC opened at $18.49 on Thursday. The company has a market capitalization of $13.28 billion, a price-to-earnings ratio of 9.94 and a beta of 0.59. Ares Capital has a one year low of $18.17 and a one year high of $23.42. The stock has a 50-day simple moving average of $19.79 and a 200 day simple moving average of $20.32. The company has a debt-to-equity ratio of 1.12, a quick ratio of 1.70 and a current ratio of 1.70.

Ares Capital (NASDAQ:ARCC) last announced its quarterly earnings data on Wednesday, February 4th. The investment management company reported $0.50 earnings per share (EPS) for the quarter, meeting the consensus estimate of $0.50. Ares Capital had a return on equity of 9.89% and a net margin of 42.56%.The firm had revenue of $793.00 million for the quarter, compared to analysts’ expectations of $795.20 million. During the same quarter in the prior year, the firm posted $0.55 earnings per share. Ares Capital’s revenue for the quarter was up 4.5% compared to the same quarter last year. Sell-side analysts predict that Ares Capital will post 2.19 EPS for the current fiscal year.

Ares Capital Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, March 31st. Investors of record on Friday, March 13th will be given a dividend of $0.48 per share. This represents a $1.92 annualized dividend and a dividend yield of 10.4%. The ex-dividend date of this dividend is Friday, March 13th. Ares Capital’s dividend payout ratio is currently 103.23%.

Wall Street Analyst Weigh In

A number of brokerages have commented on ARCC. Weiss Ratings restated a “hold (c+)” rating on shares of Ares Capital in a research note on Monday, December 29th. Wall Street Zen downgraded Ares Capital from a “hold” rating to a “sell” rating in a report on Saturday, February 7th. B. Riley Financial restated a “buy” rating on shares of Ares Capital in a research note on Monday, February 9th. Wells Fargo & Company dropped their price objective on Ares Capital from $21.00 to $20.00 and set an “overweight” rating on the stock in a report on Thursday, February 5th. Finally, Royal Bank Of Canada cut their target price on Ares Capital from $23.00 to $22.00 and set an “outperform” rating on the stock in a research report on Monday, February 9th. Seven investment analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company’s stock. According to data from MarketBeat, the company has an average rating of “Moderate Buy” and a consensus price target of $22.00.

Insider Activity

In other Ares Capital news, CFO Scott C. Lem purchased 5,186 shares of the business’s stock in a transaction that occurred on Friday, February 6th. The shares were purchased at an average price of $19.29 per share, for a total transaction of $100,037.94. Following the completion of the acquisition, the chief financial officer owned 39,463 shares of the company’s stock, valued at approximately $761,241.27. This represents a 15.13% increase in their position. The purchase was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, CEO Michael Kort Schnabel purchased 12,500 shares of Ares Capital stock in a transaction 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 completion of the transaction, the chief executive officer owned 40,500 shares of the company’s stock, valued at $774,765. This represents a 44.64% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. Insiders own 0.48% of the company’s stock.

Hedge Funds Weigh In On Ares Capital

Hedge funds have recently added to or reduced their stakes in the business. City Holding Co. raised its holdings in shares of Ares Capital by 444.4% during the third quarter. City Holding Co. now owns 1,225 shares of the investment management company’s stock worth $25,000 after purchasing an additional 1,000 shares during the period. Palladiem LLC acquired a new stake in Ares Capital during the fourth quarter worth about $26,000. SWAN Capital LLC acquired a new stake in Ares Capital during the third quarter worth about $27,000. Sankala Group LLC bought a new position in Ares Capital in the fourth quarter worth about $28,000. Finally, NBT Bank N A NY acquired a new position in Ares Capital in the third quarter valued at approximately $31,000. Institutional investors and hedge funds own 27.38% of the company’s stock.

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.