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

Ares Capital Co. (NASDAQ:ARCC) was the target of unusually large options trading activity on Friday. Investors acquired 14,321 put options on the stock. This represents an increase of approximately 199% compared to the typical volume of 4,788 put options.

Ares Capital Price Performance

Shares of ARCC stock opened at $22.18 on Friday. The firm has a market cap of $14.33 billion, a P/E ratio of 8.53 and a beta of 1.01. Ares Capital has a 1-year low of $19.32 and a 1-year high of $22.43. The firm has a fifty day moving average of $21.72 and a two-hundred day moving average of $21.17. The company has a debt-to-equity ratio of 1.06, a current ratio of 1.29 and a quick ratio of 1.29.

Ares Capital (NASDAQ:ARCC) last released its quarterly earnings data on Wednesday, October 30th. The investment management company reported $0.58 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.59 by ($0.01). Ares Capital had a net margin of 53.71% and a return on equity of 12.06%. The company had revenue of $755.00 million for the quarter, compared to analyst estimates of $770.45 million. During the same quarter in the prior year, the firm earned $0.59 EPS. The company’s revenue for the quarter was up 15.3% compared to the same quarter last year. As a group, research analysts anticipate that Ares Capital will post 2.36 earnings per share for the current fiscal year.

Ares Capital Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Monday, December 30th. Stockholders of record on Friday, December 13th were paid a $0.48 dividend. This represents a $1.92 dividend on an annualized basis and a dividend yield of 8.66%. The ex-dividend date was Friday, December 13th. Ares Capital’s dividend payout ratio is currently 73.85%.

Analyst Upgrades and Downgrades

ARCC has been the topic of several analyst reports. Wells Fargo & Company raised Ares Capital from an “equal weight” rating to an “overweight” rating in a report on Thursday, December 12th. B. Riley upped their target price on Ares Capital from $21.00 to $22.00 and gave the company a “neutral” rating in a research note on Thursday, October 31st. Finally, StockNews.com raised shares of Ares Capital from a “sell” rating to a “hold” rating in a research note on Tuesday, November 12th. Three equities research analysts have rated the stock with a hold rating, six have given a buy rating and one has issued a strong buy rating to the company. Based on data from MarketBeat.com, the company has an average rating of “Moderate Buy” and an average target price of $22.29.

Hedge Funds Weigh In On Ares Capital

Several hedge funds have recently modified their holdings of ARCC. Asset Dedication LLC acquired a new position in Ares Capital in the 2nd quarter worth approximately $26,000. Horizon Financial Services LLC acquired a new stake in Ares Capital in the 3rd quarter valued at approximately $28,000. nVerses Capital LLC increased its holdings in shares of Ares Capital by 88.9% during the 2nd quarter. nVerses Capital LLC now owns 1,700 shares of the investment management company’s stock worth $35,000 after purchasing an additional 800 shares during the period. Blue Trust Inc. raised its stake in shares of Ares Capital by 56.8% in the third quarter. Blue Trust Inc. now owns 2,510 shares of the investment management company’s stock valued at $52,000 after purchasing an additional 909 shares in the last quarter. Finally, Quarry LP acquired a new position in Ares Capital in the third quarter worth about $67,000. 27.38% of the stock is currently owned by institutional investors and hedge funds.

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.