Ares Capital Corporation (NASDAQ:ARCC) Sees Large Increase in Short Interest

Ares Capital Corporation (NASDAQ:ARCC) saw a significant increase in short interest in February. As of February 27th, there was short interest totaling 29,328,894 shares, an increase of 33.1% from the February 12th total of 22,043,281 shares. Currently, 4.1% of the company’s stock are short sold. Based on an average daily volume of 8,973,390 shares, the short-interest ratio is presently 3.3 days. Based on an average daily volume of 8,973,390 shares, the short-interest ratio is presently 3.3 days. Currently, 4.1% of the company’s stock are short sold.

Ares Capital Trading Down 1.2%

ARCC stock opened at $17.86 on Friday. Ares Capital has a one year low of $17.59 and a one year high of $23.42. The stock has a market cap of $12.82 billion, a price-to-earnings ratio of 9.60 and a beta of 0.59. The company has a fifty day moving average price of $19.69 and a two-hundred day moving average price of $20.27. The company has a debt-to-equity ratio of 1.12, a current ratio of 1.70 and a quick ratio of 1.70.

Ares Capital (NASDAQ:ARCC) last issued its quarterly earnings data on Wednesday, February 4th. The investment management company reported $0.50 earnings per share for the quarter, meeting the consensus estimate of $0.50. The company had revenue of $793.00 million for the quarter, compared to analyst estimates of $795.20 million. Ares Capital had a net margin of 42.56% and a return on equity of 9.89%. The company’s revenue was up 4.5% on a year-over-year basis. During the same period in the prior year, the firm earned $0.55 earnings per share. Equities analysts anticipate that Ares Capital will post 2.19 EPS for the current year.

Ares Capital Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Tuesday, March 31st. Investors of record on Friday, March 13th will be paid a $0.48 dividend. The ex-dividend date is Friday, March 13th. This represents a $1.92 dividend on an annualized basis and a yield of 10.8%. Ares Capital’s dividend payout ratio is 103.23%.

Insider Activity

In other Ares Capital news, CEO Michael Kort Schnabel purchased 12,500 shares of the stock in a transaction on Thursday, February 5th. The shares were purchased at an average cost of $19.13 per share, for a total transaction of $239,125.00. Following the purchase, the chief executive officer owned 40,500 shares of the company’s stock, valued at approximately $774,765. This represents a 44.64% increase in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CFO Scott C. Lem purchased 5,186 shares of the business’s stock in a transaction on Friday, February 6th. The shares were acquired at an average cost of $19.29 per share, for a total transaction of $100,037.94. Following the completion of the transaction, the chief financial officer directly owned 39,463 shares in the company, valued at approximately $761,241.27. This represents a 15.13% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. 0.48% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Ares Capital

A number of institutional investors have recently made changes to their positions in the company. City Holding Co. increased its stake in shares of Ares Capital by 444.4% during the third quarter. City Holding Co. now owns 1,225 shares of the investment management company’s stock worth $25,000 after purchasing an additional 1,000 shares during the period. Palladiem LLC bought a new stake in Ares Capital in the 4th quarter valued at $26,000. SWAN Capital LLC bought a new stake in Ares Capital in the 3rd quarter valued at $27,000. Sankala Group LLC acquired a new position in Ares Capital in the 4th quarter valued at $28,000. Finally, NBT Bank N A NY acquired a new position in Ares Capital in the 3rd quarter valued at $31,000. Institutional investors own 27.38% of the company’s stock.

Ares Capital News Roundup

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

• Positive Sentiment: Wall Street analyst consensus still leans favorable — several write-ups note analysts’ recommendations and an overall “buy/hold” tilt that supports interest in ARCC from income-seeking investors. Wall Street Bulls Look Optimistic About Ares Capital (ARCC)
• Positive Sentiment: Ares was featured in an article highlighting high-yield/dividend names attractive to income investors — this can sustain demand from yield-focused funds and retail buyers. Risk-Savvy Investors Love 4 Passive Income Kings Yielding 10% and More
• Neutral Sentiment: JPMorgan cut its price target (from $22 to $19) while keeping an overweight rating — the lower target trims upside but the positive rating limits downside impact. Benzinga
• Neutral Sentiment: Reports flagged unusually large options activity in ARCC, which can signal short-term positioning or hedging but isn’t definitive on direction. Ares Capital Target of Unusually Large Options Trading
• Neutral Sentiment: Market headlines documenting a recent intraday price drop are amplifying attention but mainly reflect short-term trading volatility rather than new company fundamentals. Ares Capital Registers a Bigger Fall Than the Market
• Neutral Sentiment: Short-interest data reported appears inconsistent (zeros/NaN), so there’s no clear signal from short-position metrics at this time. (Data quality issue.)
• Negative Sentiment: UBS lowered its price target from $21 to $19 and moved to a “neutral” rating — a downgrade in analyst sentiment that reduces the stock’s perceived upside and likely weighs on price. Benzinga
• Negative Sentiment: Broader market concern about “PIK” (paid-in-kind) loans — borrowers paying interest with IOUs instead of cash — raises credit-quality worries for loan-focused vehicles like ARCC, pressuring sentiment for BDCs and leveraged-credit lenders. ‘PIK’ Loans Are the Market’s Latest Concern

Wall Street Analysts Forecast Growth

A number of analysts have commented on ARCC shares. Wells Fargo & Company cut their price target on shares of Ares Capital from $21.00 to $20.00 and set an “overweight” rating for the company in a research note on Thursday, February 5th. Weiss Ratings restated a “hold (c+)” rating on shares of Ares Capital in a research note on Monday, December 29th. JPMorgan Chase & Co. dropped their target price on shares of Ares Capital from $22.00 to $19.00 and set an “overweight” rating on the stock in a report on Friday. Royal Bank Of Canada cut their target price on shares of Ares Capital from $23.00 to $22.00 and set an “outperform” rating for the company in a research note on Monday, February 9th. Finally, UBS Group lowered their price target on Ares Capital from $21.00 to $19.00 and set a “neutral” rating on the stock in a research report on Friday. Seven research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company. According to data from MarketBeat, the company has a consensus rating of “Moderate Buy” and a consensus target price of $21.38.

Ares Capital Company Profile

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.