Short Interest in Ares Capital Co. (NASDAQ:ARCC) Drops By 10.6%

Ares Capital Co. (NASDAQ:ARCC) was the target of a large drop in short interest in the month of November. As of November 15th, there was short interest totalling 15,590,000 shares, a drop of 10.6% from the October 31st total of 17,440,000 shares. Based on an average daily trading volume, of 3,350,000 shares, the days-to-cover ratio is currently 4.7 days.

Ares Capital Price Performance

ARCC opened at $22.10 on Tuesday. The company has a debt-to-equity ratio of 1.06, a current ratio of 1.29 and a quick ratio of 1.29. The stock has a market capitalization of $14.28 billion, a P/E ratio of 8.50 and a beta of 1.01. The company’s 50 day simple moving average is $21.38 and its 200-day simple moving average is $21.07. Ares Capital has a one year low of $19.32 and a one year high of $22.30.

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

Ares Capital Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Monday, December 30th. Shareholders of record on Friday, December 13th will be issued a dividend of $0.48 per share. The ex-dividend date of this dividend is Friday, December 13th. This represents a $1.92 annualized dividend and a yield of 8.69%. Ares Capital’s dividend payout ratio is currently 73.85%.

Hedge Funds Weigh In On Ares Capital

Several large investors have recently bought and sold shares of ARCC. Van ECK Associates Corp grew its holdings in Ares Capital by 8.3% during the 3rd quarter. Van ECK Associates Corp now owns 12,656,154 shares of the investment management company’s stock worth $272,107,000 after acquiring an additional 975,045 shares during the period. Confluence Investment Management LLC increased its holdings in Ares Capital by 1.7% in the third quarter. Confluence Investment Management LLC now owns 3,836,573 shares of the investment management company’s stock valued at $80,338,000 after purchasing an additional 63,999 shares during the last quarter. International Assets Investment Management LLC increased its holdings in Ares Capital by 2,104.7% in the third quarter. International Assets Investment Management LLC now owns 3,613,285 shares of the investment management company’s stock valued at $756,620,000 after purchasing an additional 3,449,395 shares during the last quarter. LPL Financial LLC lifted its stake in Ares Capital by 8.5% in the second quarter. LPL Financial LLC now owns 3,492,247 shares of the investment management company’s stock valued at $72,778,000 after buying an additional 273,025 shares during the period. Finally, Sound Income Strategies LLC boosted its holdings in Ares Capital by 3.7% during the third quarter. Sound Income Strategies LLC now owns 2,217,277 shares of the investment management company’s stock worth $46,430,000 after buying an additional 79,074 shares during the last quarter. 27.38% of the stock is currently owned by institutional investors and hedge funds.

Analyst Ratings Changes

ARCC has been the topic of a number of analyst reports. Wells Fargo & Company upgraded Ares Capital from an “equal weight” rating to an “overweight” rating and set a $23.00 price target on the stock in a research report on Monday. B. Riley increased their target price on shares of Ares Capital from $21.00 to $22.00 and gave the stock a “neutral” rating in a research report on Thursday, October 31st. StockNews.com upgraded shares of Ares Capital from a “sell” rating to a “hold” rating in a research report on Tuesday, November 12th. Royal Bank of Canada reaffirmed an “outperform” rating and set a $22.00 price objective on shares of Ares Capital in a report on Monday, August 5th. Finally, UBS Group raised Ares Capital to a “hold” rating in a report on Friday, August 23rd. Three analysts have rated the stock with a hold rating, six have assigned a buy rating and one has assigned a strong buy rating to the company’s stock. According to MarketBeat.com, Ares Capital presently has a consensus rating of “Moderate Buy” and a consensus target price of $22.29.

Ares Capital Company Profile

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.