Ares Capital Invests $28.7 Billion, Offers Stable Dividends Attracting Investors
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Portfolio Scale: As of Q3, Ares Capital has invested $28.7 billion across 587 portfolio companies, with 71% in senior secured loans, showcasing its strong investment capability in the middle-market sector and enhancing its competitive edge.
- Stable Dividend Policy: Ares Capital pays a quarterly dividend of $0.48, yielding 9.4% annually, and has maintained or increased its dividend for the past 16 years, reflecting its robust cash flow and profitability.
- New Investment Commitments: In Q3, Ares Capital secured $3.9 billion in new investment commitments, significantly exceeding $2.6 billion in exited commitments, indicating strong expansion capability and investor confidence in the market.
- Financial Resilience: Ares Capital reported GAAP net income of $0.57 per share, comfortably covering its dividend payments, while also carrying forward $1.26 per share of excess taxable income, providing additional cushion for future dividends.
Analyst Views on ARCC
Wall Street analysts forecast ARCC stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for ARCC is 22.44 USD with a low forecast of 21.00 USD and a high forecast of 24.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
10 Analyst Rating
8 Buy
2 Hold
0 Sell
Strong Buy
Current: 20.230
Low
21.00
Averages
22.44
High
24.00
Current: 20.230
Low
21.00
Averages
22.44
High
24.00
About ARCC
Ares Capital Corporation is a specialty finance company focused on providing direct loans and other investments in private middle market companies in the United States. The Company invests primarily in first lien senior secured loans (including unitranche loans, which are loans that combine both senior and subordinated debt, generally in a first lien position), and second lien senior secured loans. In addition to senior secured loans, it also invests in subordinated debt, which in some cases includes an equity component, and preferred equity. It also may invest up to 30% of its portfolio in non-qualifying assets. Its investment activities are focused on industries, such as software and services, health care services, commercial and professional services, financial services, commercial and professional services, insurance services, energy, food and beverage and others. The Company is externally managed by Ares Capital Management LLC (investment adviser).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
