Royal Bank of Canada Decreases Position in Ares Capital Corporation $ARCC

Royal Bank of Canada lessened its position in Ares Capital Corporation (NASDAQ:ARCC) by 11.5% during the 1st quarter, according to the company in its most recent Form 13F filing with the SEC. The institutional investor owned 2,669,192 shares of the investment management company’s stock after selling 345,189 shares during the period. Royal Bank of Canada’s holdings in Ares Capital were worth $48,099,000 as of its most recent SEC filing.

Other institutional investors and hedge funds also recently made changes to their positions in the company. Palladiem LLC purchased a new position in Ares Capital in the 4th quarter worth approximately $26,000. SWAN Capital LLC purchased a new stake in Ares Capital during the 3rd quarter valued at $27,000. Sankala Group LLC bought a new stake in shares of Ares Capital in the 4th quarter worth $28,000. Core Wealth Advisors LLC bought a new stake in shares of Ares Capital in the 4th quarter worth $33,000. Finally, Quarry LP purchased a new position in shares of Ares Capital in the third quarter worth $33,000. Institutional investors own 27.38% of the company’s stock.

Key Ares Capital News

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

• Positive Sentiment: Second-quarter earnings held up, with adjusted EPS of $0.47 matching estimates and investment income remaining resilient. Management also highlighted ARCC’s scale, improving lending terms and balance-sheet flexibility despite a slower transaction market. Ares Capital’s Q2 Earnings Call Highlights Market Strength
• Positive Sentiment: ARCC declared a quarterly dividend of $0.48 per share, payable September 30 to shareholders of record September 15. The roughly 10.2% annualized yield and 17-year dividend streak support the stock’s appeal to income-focused investors. Ares Capital Just Extended Its Dividend Streak to 17 Years
• Positive Sentiment: Truist maintained a “buy” rating with a $21 price target, while Keefe, Bruyette & Woods retained an “outperform” rating with a $20 target, indicating analysts still see potential upside from current levels. Analyst Price Target Updates
• Neutral Sentiment: Broader private-credit results remained resilient, and strong fundraising across the Ares platform points to continued institutional demand. However, elevated defaults, retail redemptions and liquidity concerns remain important industry risks. Private Credit Roundup
• Negative Sentiment: Five ARCC borrowers were moved to non-accrual status during the second quarter. The largest was an $84.6 million subordinated loan to AmeriVet Veterinary Partners, raising concerns about portfolio credit quality and potential pressure on net asset value. Ares BDC Moves Five Borrowers to Non-Accrual
• Negative Sentiment: Although quarterly revenue was close to expectations, year-over-year expenses increased and unrealized losses weighed on results. Both Truist and KBW lowered their price targets, signaling a more cautious outlook even while keeping positive ratings. ARCC Stock Dips as Q2 Earnings Meet Estimates

Wall Street Analyst Weigh In

Several equities research analysts recently commented on the company. Wall Street Zen cut Ares Capital from a “hold” rating to a “sell” rating in a research report on Sunday. Wells Fargo & Company reissued an “equal weight” rating and issued a $19.00 target price (down from $20.00) on shares of Ares Capital in a research report on Friday, June 12th. Weiss Ratings restated a “hold (c)” rating on shares of Ares Capital in a research note on Tuesday, June 9th. Citizens Jmp dropped their price target on shares of Ares Capital from $23.00 to $22.00 and set a “market outperform” rating on the stock in a report on Wednesday, April 22nd. Finally, JPMorgan Chase & Co. reduced their price target on shares of Ares Capital from $19.00 to $18.50 and set an “overweight” rating for the company in a research note on Thursday, July 2nd. Eight research analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company’s stock. According to data from MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and an average target price of $20.40.

Ares Capital Stock Performance

Shares of NASDAQ:ARCC opened at $18.76 on Monday. The stock has a market capitalization of $13.47 billion, a price-to-earnings ratio of 13.90 and a beta of 0.56. The company has a debt-to-equity ratio of 1.14, a quick ratio of 1.28 and a current ratio of 1.28. The stock’s 50-day simple moving average is $18.67 and its two-hundred day simple moving average is $18.89. Ares Capital Corporation has a 52-week low of $17.40 and a 52-week high of $22.85.

Ares Capital (NASDAQ:ARCC) last released its quarterly earnings results on Wednesday, July 29th. The investment management company reported $0.47 earnings per share (EPS) for the quarter, meeting analysts’ consensus estimates of $0.47. Ares Capital had a return on equity of 9.80% and a net margin of 30.91%.The business had revenue of $768.00 million during the quarter, compared to the consensus estimate of $770.19 million. During the same period in the previous year, the company posted $0.50 EPS. Analysts expect that Ares Capital Corporation will post 1.9 EPS for the current year.

Ares Capital Announces Dividend

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, September 30th. Shareholders of record on Tuesday, September 15th will be given a $0.48 dividend. The ex-dividend date is Tuesday, September 15th. This represents a $1.92 annualized dividend and a yield of 10.2%. Ares Capital’s dividend payout ratio (DPR) is presently 142.22%.

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.