ARCC - Ares Capital Corporation

NasdaqGS - NasdaqGS Real Time Price. Currency in USD
19.00
-0.03 (-0.16%)
At close: 4:00PM EST

19.00 0.00 (0.00%)
After hours: 4:08PM EST

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Previous Close19.03
Open19.01
Bid18.98 x 800
Ask19.08 x 4000
Day's Range18.92 - 19.06
52 Week Range16.84 - 19.33
Volume1,509,941
Avg. Volume1,890,849
Market Cap8.19B
Beta (5Y Monthly)0.66
PE Ratio (TTM)10.23
EPS (TTM)1.86
Earnings DateApr 27, 2020 - May 03, 2020
Forward Dividend & Yield1.60 (8.41%)
Ex-Dividend DateMar 12, 2020
1y Target Est19.70
  • Hercules Capital (HTGC) Q4 Earnings Beat on Higher Revenues
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    Hercules Capital (HTGC) witnesses higher total investment income along with rise in expenses in the fourth quarter of 2019.

  • Analysts: 2 Big 8% Dividend Stocks to Buy (And 1 to Sell)
    TipRanks

    Analysts: 2 Big 8% Dividend Stocks to Buy (And 1 to Sell)

    Not all dividend stocks are created equal. The average dividend yield among S&P companies is only 2%, not much higher than a Treasury bond. Years of low-interest policy from the Fed has worked to push return rates down across the board, and dividend yields – on average – have simply lagged slightly.Of course, that’s an average. You can still find high returns out there, and dividend stocks are a logical place to look. After all, while Fed rates may establish a cap for bond interest, dividends are only limited by the paying company’s overall profits. The sky’s the limit.We’re taking a look at that boundless upper limit today, using the TipRanks Stock Screener tool to pull up three stocks with 8% or better dividend yields. And back to our initial point, to show how high dividends are not the only factor to consider, Wall Street’s analysts only rate two of these as Buys. Let’s dive in.Plains GP Holdings (PAGP)Our first stock is a holding company, whose subsidiaries operate in the oil industry. The company’s operational arms are involved in the crude oil midstream sector, including transport, storage, terminalling, and marketing, as well as the liquid petroleum gas (LPG) and natural gas storage segments. PAGP has a $3 billion market cap, a high upside potential, and a surprising low point of entry.The stock is down 26% over the past 12 months, as the oil industry has faced a continuing low-price regime. While oil is a necessary commodity, that today’s economy cannot do without, a combination of high production and slack demand has put downward pressure on prices. WTI, the main US benchmark price, is down 6.6% in the past 12 months, and trading has been volatile in the oil markets.Despite the headwinds in the oil markets, PAGP beat the revenue estimates in its Q4 earnings report, while missing on earnings. EPS was reported at 26 cents, down steeply year-over-year and only half what was expected. In better news, the company reported $9.15 billion to top-line revenue, 9.3% better than the $8.37 billion forecast.With net-positive earnings and rising revenues, PAGP was able to maintain its 36-cent per share quarterly dividend, even while the payout ratio bumped up to a dangerous 136%. The company has been making reliable dividend payments since 2014, and has raised the payment modestly in the past two years. At $1.44 annualized, the yield is a generous 8.54%.Barclays analyst Christine Cho sees PAGP growing going forward, resting as it does on a sound foundation. She writes, in her recent report on the stock, “Fundamentals remain on solid footing for the industry, with midstream companies largely posting record profits, production set to grow in 2020, and crude prices generally stabilizing… we think global supply/demand for oil is more balanced, supported by the combination of increased capital discipline on the part of U.S. shale producers, OPEC production cuts, and subsiding recession fears...”Cho puts a $24 price target on PAGP, suggesting an upside of 42% behind her Buy rating. (To watch Cho’s track record, click here)Overall, Plains GP has a Strong Buy from the analyst consensus, with 4 recent reviews that include 3 Buys and 1 Hold. Shares are priced affordably, at $16.83, and the $21.33 average price target implies room for a robust 26% upside. (See Plains GP’s stock analysis at TipRanks)Ares Capital Corporation (ARCC)Moving on, we enter the investment management sector. Ares Capital is an asset manager with a focus on providing full-service financial solutions for middle-market companies. It has been traded publicly since 2014 and the stock has paid a reliable dividend ever since. ARCC has a market cap over $8 billion, and brings in over $1.5 billion in annual revenue.In Q4, Ares met earnings expectation, with EPS reported on target at 45 cents. Quarterly investment income was up 12% year-over-year, to $386 million, but missed the forecast. Total investment income for 2019 was reported at $1.53 billion, in line with estimates and up 14.3% from 2018. While the earnings and revenue were generally seen as good, the company reported 28.7% higher expenses in Q4, a development that pushed stock prices down 1.4% since the release.The quarterly figures were good enough to maintain ARCC’s dividend, which pays out 40 cents per share quarterly. The $1.60 annualized figure gives a yield of 8.42%, far above the broader market average. At 89%, the payout ratio indicates that Ares returns most of its profits to shareholders – but that it can afford to do so. ARCC has been slowing raising the dividend payment over the last few years.Lana Chan, 4-star analyst from BMO Capital, likes what she sees in ARCC. Citing especially the company’s ability to meet challenges, she writes, “ARCC currently has ~$3 billion in undrawn credit commitments and remains at the low end of its targeted leverage range, giving management ample dry powder to take advantage of any future market opportunities.”Chan gives this stock a Buy rating, and backs it with a $21 price target. Her target indicates an 11% growth potential in coming months. (To watch Chan’s track record, click here)Also bullish is Jefferies 5-star analyst John Hecht. He wrote of the stock’s overall condition, “Revenues of $386M were consistent with our forecast, as robust portfolio growth and higher dividend income offset ongoing yield compression. The portfolio grew 16% YoY, ahead of our forecast, as ARCC ramped leverage to 0.93x. Credit remains stable and below peer averages while NOI is comfortably ahead of ARCC's consistent distribution…”In line with his upbeat outlook, Hecht set a $20.50 price target, with an 8.5% upside potential, to support his Buy rating on ARCC. (To watch Hecht’s track record, click here)With 8 recent Buy ratings, ARCC’s analyst consensus view is a unanimous Strong Buy. This is another affordable stock, priced at just $18.89. The average price target of $20 suggests a modest upside potential of 5.88% for the stock. (See Ares Capital stock analysis at TipRanks)Hersha Hospitality (HT)The last stock on our list is the sell-side call. Hersha Hospitality is a real estate investment trust (REIT), a company specializing in buying, owning, operating, and leasing various residential and commercial properties. In compliance with tax law, these companies must return the bulk of their profits to shareholders, making them frequent visitors to “great dividend stock” lists. But not always.Hersha owns 48 hotels, with a total of 7,644 rooms, on both coasts of the US. The company’s West Coast properties are located in California and Washington, while the more numerous East Coast properties are located in Massachusetts, New York, Pennsylvania, Washington DC, and South Florida. New York and California have the most Hersha properties, with 10 and 7 respectively.High costs in urban areas have put a damper on company profits, and the company reported 53 cents per share in funds from operations (FFO). This was 8.6% below the forecast, and a 23% drop from the prior year’s Q3. Total revenue, at $135 million, was closer to the forecast (missing by less than 1%), and up 5.5% year-over-year. In the last four quarters, HT has only beating the forecasts once – and the stock is down 18% in the past 12 months.While earnings were mixed, Hersha kept up its dividend payments. The company pays out 28 cents per share quarterly, or $1.12 annualized, and shows a yield of 8%. Hersha has paid out the dividend reliably since 2011, an enviable record. The payout ratio is low for an REIT, at just 53%.Wall Street’s analysts are not impressed with HT shares right now. Writing from Barclays, Anthony Powell notes “Hersha’s 3Q19 results missed our estimates, guidance and consensus as conditions in several of the company’s urban markets were more challenging than the company originally forecast. While Hersha continued to outperform in several of its markets, the overall softer environment in 3Q and October drives a 6% reduction in EBITDA guidance for the year. Looking forward… high supply growth in New York and relatively high leverage will remain concerns for investors”Powell’s $14 price target on HT shares indicates a slight downside from current prices, in line with his Sell rating. (To watch Powell’s track record, click here)4-star analyst Ari Klein, of BMO Capital, is also downbeat on this stock. He writes, “HT reported a weaker 3Q19 and lowered 2019 guidance, including adjusted EBITDA guidance by 5% at the midpoint and adjusted FFOps by 8%... EBITDA growth is not materializing as expected by HT…”Klein rates the stock a Sell, and his $12.50 price target implies a downside of 11.4%. (To watch Klein’s track record, click here)Hersha Hospitality gets a Moderate Sell rating from the analyst consensus, with 2 Hold and 1 Sell rating given in recent weeks. Shares are priced at $14.11, and the $14.33 average price target suggests a minimal upside of 1.56%. (See Hersha stock analysis at TipRanks)

  • Thomson Reuters StreetEvents

    Edited Transcript of ARCC earnings conference call or presentation 12-Feb-20 5:00pm GMT

    Q4 2019 Ares Capital Corp Earnings Call

  • Bloomberg

    Private Lenders Hit Hot High-Grade Market to Cut Borrowing Costs

    (Bloomberg) -- Private credit lenders are turning into borrowers as they seek to manage their own debt loads.In recent weeks, private lenders to mid-sized companies including Ares Capital Corp. and Goldman Sachs BDC Inc. have tapped the U.S. investment-grade bond market to refinance their own debt loads. Such transactions can give the vehicles, called business development companies, a cheap source of funding to deploy into the $800 billion private credit market.BDCs have already sold $2 billion of investment-grade debt this year, according to data compiled by Bloomberg, after issuing about $3 billion of the notes in all of 2019.The vehicles’ renewed interest in investment-grade debt comes amid a wave of opportunistic refinancing, as borrowing costs have rarely been cheaper. The average high-grade company paid an interest rate of 2.59% Tuesday, hovering near the all-time low.Most of the BDCs selling debt now are doing so to pay down revolvers, effectively swapping their credit lines for longer-term unsecured bonds. By locking in low rates, the BDCs can turn around and use that funding to provide capital at higher costs to companies too small to tap the syndicated debt markets themselves.Strong investor demand and BDCs’ desire to lock in low interest rates mean the issuance wave could continue, said Chelsea Richardson, associate director of non-bank financial institutions at Fitch Ratings.“We’ll continue to see additional firms that haven’t accessed the market in a while or want to continue to diversify their funding sources go to the unsecured debt markets this year,” Richardson said.One BDC that may follow suit is Golub Capital BDC Inc., which is “actively looking” at the bond market and other potential strategies for improving its balance sheet, chief executive officer David Golub said in a recent earnings call.Golub Capital BDC, which recently combined with a related vehicle to form a $4.6 billion BDC, may find the bond market more receptive to its larger size. “All things equal, larger BDCs are able to obtain a lower cost of debt within the institutional market,” Raymond James analyst Robert Dodd wrote in a report last week.Representatives for Ares Capital, Goldman Sachs BDC and Golub declined to comment.Fitch views the move to unsecured debt as a plus for the BDCs because the vehicles gain flexibility when they have fewer assets pledged as debt collateral. But Richardson said the credit grader is still watching the space closely given the industry’s cutthroat competition and trend toward riskier loans.“We do continue to have a negative outlook on BDCs, driven by the competitive market dynamics in middle market lending,” Richardson said.\--With assistance from Brian Smith.To contact the reporter on this story: Kelsey Butler in New York at kbutler55@bloomberg.netTo contact the editors responsible for this story: Natalie Harrison at nharrison73@bloomberg.net, Claire Boston, Molly SmithFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Ares Capital (ARCC) Q4 Earnings Meet, Stock Declines 1.2%
    Zacks

    Ares Capital (ARCC) Q4 Earnings Meet, Stock Declines 1.2%

    Rise in total investment income supports Ares Capital (ARCC) Q4 earnings, but higher costs hurt.

  • Ares Capital (ARCC) Meets Q4 Earnings Estimates
    Zacks

    Ares Capital (ARCC) Meets Q4 Earnings Estimates

    Ares Capital (ARCC) delivered earnings and revenue surprises of 0.00% and -0.36%, respectively, for the quarter ended December 2019. Do the numbers hold clues to what lies ahead for the stock?

  • Business Wire

    Ares Capital Corporation Announces December 31, 2019 Financial Results and Declares First Quarter 2020 Dividend of $0.40 Per Share

    Ares Capital Corporation ("Ares Capital") (NASDAQ: ARCC) announced that its Board of Directors has declared a first quarter dividend of $0.40 per share. The first quarter dividend is payable on March 31, 2020 to stockholders of record as of March 16, 2020.

  • What's in the Cards for Ares Capital (ARCC) in Q4 Earnings?
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    What's in the Cards for Ares Capital (ARCC) in Q4 Earnings?

    Ares Capital's (ARCC) results for the fourth quarter of 2019 are expected to reflect favorable impacts of an anticipated rise in investment income.

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  • Prospects Look Gloomy for SBIC & Commercial Finance Industry
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    Prospects Look Gloomy for SBIC & Commercial Finance Industry

    Prospects Look Gloomy for SBIC & Commercial Finance Industry

  • Ares Capital (ARCC) Reports Next Week: What Awaits?
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    Ares Capital (ARCC) Reports Next Week: What Awaits?

    Ares Capital (ARCC) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

  • Ares Capital (ARCC) Gains But Lags Market: What You Should Know
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    Ares Capital (ARCC) Gains But Lags Market: What You Should Know

    Ares Capital (ARCC) closed the most recent trading day at $18.94, moving +0.48% from the previous trading session.

  • Business Wire

    Ares Capital Corporation Announces Tax Reporting Information for Calendar Year 2019

    Ares Capital Corporation ("Ares Capital" or the "Company") (NASDAQ:ARCC) announced today the tax treatment of the Company’s 2019 common stock distributions (CUSIP : 04010L103).

  • The Zacks Analyst Blog Highlights: Ares Capital, Booz Allen Hamilton, Campbell Soup Company, DHT and The Buckle
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    The Zacks Analyst Blog Highlights: Ares Capital, Booz Allen Hamilton, Campbell Soup Company, DHT and The Buckle

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  • Zacks.com featured highlights include: Williams-Sonoma, SS&C Technologies, Teradyne, First Horizon National and Ares Capital
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    Zacks.com featured highlights include: Williams-Sonoma, SS&C Technologies, Teradyne, First Horizon National and Ares Capital

    Zacks.com featured highlights include: Williams-Sonoma, SS&C Technologies, Teradyne, First Horizon National and Ares Capital

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  • 3 Buy-Rated Dividend Stocks Yielding 8% — Or More
    TipRanks

    3 Buy-Rated Dividend Stocks Yielding 8% — Or More

    When a stock goes up, that's good. We all like to "buy low" and "sell high." Problem is, that's not always the way things work out. Sometimes, you buy a stock low, and it fails to become high. In fact, sometimes it goes... lower!So how do profit when a stock stubbornly refuses to go up? How do you mitigate the damage of a stock that sinks instead of rising? How do you guarantee that you make a profit no matter what?One word: Dividends.Using TipRank's Stock Screener tool it's possible to identify and invest in stocks paying dividends rich enough to deliver something close to the stock market's promised "10% long-term average return" out of dividend income alone. And if, in an ideal situation, the stock both pays its dividend and goes up in stock price? Why then, you should be well ahead of the game. Here are three stocks offering such double-whammy profit potential.Saratoga Investment (SAR)Beginning at the top, Saratoga Investment is a corporation that makes investments (Surprise!). Specifically, it's a business development company that specializes in lending money and making equity investments to facilitate leveraged and management buyouts of smaller companies -- companies doing at least $2 million in annual earnings before interest, taxes, depreciation, and amortization (EBITDA).Last week, Saratoga Investment was brought to our attention by Maxim analyst Michael Diana, when he noted that two recent investment "exits" had provided enough liquidity to raise the company's net asset value by about 9% -- prompting a price target hike to $29 a share. Saratoga closed trading Friday at $26.74, so that's a target price about 8.5% above current market price. (To watch Diana's track record, click here)But as I've already implied, price target isn't the only attraction at Saratoga, which also pays a big dividend yield of 8.7%. That's more than 4x the going rate on the S&P 500, and as Diana points out, Saratoga grew its dividend payout for 20 consecutive quarters before taking a "pause" in fiscal Q3 2020. What's more, once Saratoga has had an opportunity to reinvest the cash raised from its recent exits, Diana anticipates we'll see further dividend hikes in this company's future -- perhaps as soon as fiscal 2021.This prospect appears to have attracted the attention of other analysts as well. In addition to Maxim, two other investment banks, B. Riley FBR and Compass Point, have issued buy ratings on the stock in the past week. With an average target price of $27.60, Wall Street seems in agreement that this stock is worth at least 3% more than it's selling for today, and with its dividend added in, should deliver a total expected return on the order of nearly 12% over the next year. (See Saratoga stock analysis at TipRanks)Ares Capital Corp (ARCC)A second company in the business development biz is Ares Capital Corporation, and like Saratoga, it's a generous dividend payer -- 8.6%. Un-like Saratoga, Ares Capital is a much larger fish, boasting a market capitalization of $7.9 billion, versus Saratoga's market cap of just $260 million.With much more capital to work with, Ares also fishes in deeper waters. A specialist in business acquisitions, recapitalizations, and restructurings, this company makes investments as large as $400 million at a time -- and in companies doing up to $250 million in EBITDA -- both through the extension of direct loans, and also by participating in syndicated loans (loans extended by a group of companies acting in concert, and spreading around both the risk and the profit).Earlier this month, Ares, too won an endorsement on Wall Street, when Wedbush analyst Henry Coffey bumped his its 12-month price target by 5% to $21 a share, implying 12.5% upside to the shares. (To watch Coffey's track record, click here)Whereas Maxim believes that Saratoga will resume raising its dividends next year, Coffey is optimistic that Ares will hike its dividend this year, and not by a little either, but from $0.40 to $0.47 per share -- a 17.5% increase.Incidentally, Coffey's price target is now the highest on Wall Street -- but others do share his sentiment. On average, analysts see about 10% upside to $20.50 for this stock, and the most recent rating prior to Coffey's was likewise a "buy" -- from RBC Capital analyst Kenneth Lee. (See Ares Capital stock analysis at TipRanks)Global Net Lease (GNL)Shifting gears a bit here at the end, our third and final 8%-plus payer of the day is not a business development company, but a real estate investment trust (REIT) instead.Focusing on the leasing of commercial office space (52% of assets), industrial and warehouse space (43%), and retail (5%0, Global Net Lease is a globe-spanning corporation with $1.8 billion in market cap, $300 million in revenue, and operations in seven different countries in Europe and North America. In line with the well-publicized struggles of brick-and-mortar retail in the U.S., Global Net Lease has been gradually reducing its exposure to this aspect of the market, in particular, divesting 32 Family Dollar locations in the final quarter of 2019.The company still does good business with the properties it's keeping, however, and indeed has 99.6% of the properties on its books leased and generating rental income.Speaking of which, Global Net Lease stands out on today's list as the only company that currently pays out more money in dividends than it makes in profit -- a point of some concern inasmuch as the company needs to earn profits if it's to maintain its generous 10.5% dividend yield. No to worry, though. In a note issued in November, B. Riley FBR analyst Bryan Maher assured investors that recent purchases of "12 net lease properties in the U.S." and planned purchases of 17 other properties in the U.S., Italy, and Canada, have Global Net lease "on pace to [earn enough money to] cover its dividend by mid-2021."Accordingly, Maher maintains a "buy" rating on the stock with a $24 price target that implies nearly 21% upside to the stock. (To watch Maher's track record, click here)Judging from the consensus breakdown, it has been relatively quiet when it comes to other analyst activity. Over the last three months, only 2 analysts have reviewed the real estate firm. Both of which, however, were bullish, making the consensus a Moderate Buy. On top of this, the $22.75 average price target puts the upside potential at ~15%. (See GNL stock analysis at TipRanks)

  • Business Wire

    Ares Capital Corporation Schedules Earnings Release for the Fourth Quarter and Fiscal Year Ended December 31, 2019

    Ares Capital Corporation ("Ares Capital") (NASDAQ: ARCC) announced today that it will report earnings for the fourth quarter and fiscal year ended December 31, 2019 on Wednesday, February 12, 2020 prior to the opening of the Nasdaq Global Select Market. Ares Capital invites all interested persons to attend its webcast/conference call at 12:00 p.m. (Eastern Time) on the same day to discuss its fourth quarter and fiscal year ended December 31, 2019 financial results.

  • Business Wire

    Ares Capital Corporation Prices Public Offering of $750.0 Million 3.250% Unsecured Notes Due 2025

    Ares Capital Corporation (Nasdaq: ARCC) announced that it has priced an underwritten public offering of $750.0 million in aggregate principal amount of 3.250% notes due 2025. The notes will mature on July 15, 2025 and may be redeemed in whole or in part at Ares Capital’s option at any time at par plus a "make-whole" premium, if applicable.

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