Cullen Frost Bankers Inc. Boosts Stake in Ares Capital Co. (ARCC)

Cullen Frost Bankers Inc. lifted its position in shares of Ares Capital Co. (NASDAQ:ARCC) by 47.1% in the 4th quarter, according to its most recent 13F filing with the SEC. The firm owned 40,461 shares of the investment management company’s stock after acquiring an additional 12,957 shares during the quarter. Cullen Frost Bankers Inc.’s holdings in Ares Capital were worth $631,000 at the end of the most recent quarter.

A number of other hedge funds and other institutional investors also recently modified their holdings of ARCC. Marshall Wace LLP bought a new position in Ares Capital in the 3rd quarter worth about $12,517,000. DPM Capital LLC bought a new position in Ares Capital in the 4th quarter worth about $11,269,000. Vaughan Nelson Investment Management L.P. boosted its stake in Ares Capital by 7.9% in the 4th quarter. Vaughan Nelson Investment Management L.P. now owns 6,437,206 shares of the investment management company’s stock worth $100,292,000 after purchasing an additional 472,555 shares during the period. Shufro Rose & Co. LLC bought a new position in Ares Capital in the 4th quarter worth about $6,368,000. Finally, First Republic Investment Management Inc. boosted its stake in Ares Capital by 94.5% in the 3rd quarter. First Republic Investment Management Inc. now owns 716,735 shares of the investment management company’s stock worth $12,321,000 after purchasing an additional 348,212 shares during the period. Institutional investors and hedge funds own 39.45% of the company’s stock.

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Several analysts have weighed in on ARCC shares. National Securities reaffirmed a “buy” rating and issued a $19.00 price target on shares of Ares Capital in a report on Thursday, November 1st. BidaskClub raised Ares Capital from a “hold” rating to a “buy” rating in a report on Tuesday, November 13th. JMP Securities raised their price target on Ares Capital from $19.00 to $19.50 and gave the company a “market outperform” rating in a report on Wednesday, February 13th. Oppenheimer set a $18.00 price target on Ares Capital and gave the company a “buy” rating in a report on Thursday, November 1st. Finally, Zacks Investment Research raised Ares Capital from a “hold” rating to a “buy” rating and set a $19.00 price target on the stock in a report on Thursday, November 15th. One analyst has rated the stock with a hold rating and seven have given a buy rating to the company’s stock. Ares Capital has a consensus rating of “Buy” and a consensus target price of $18.75.

NASDAQ:ARCC opened at $17.16 on Monday. Ares Capital Co. has a twelve month low of $14.50 and a twelve month high of $17.63. The stock has a market capitalization of $7.32 billion, a price-to-earnings ratio of 10.21, a price-to-earnings-growth ratio of 3.35 and a beta of 0.62. The company has a debt-to-equity ratio of 0.71, a quick ratio of 2.41 and a current ratio of 1.05.

Ares Capital (NASDAQ:ARCC) last released its quarterly earnings results on Tuesday, February 12th. The investment management company reported $0.45 earnings per share for the quarter, beating the consensus estimate of $0.41 by $0.04. Ares Capital had a return on equity of 9.69% and a net margin of 64.17%. The firm had revenue of $345.00 million for the quarter, compared to analysts’ expectations of $327.24 million. During the same quarter last year, the firm posted $0.38 EPS. As a group, research analysts expect that Ares Capital Co. will post 1.7 earnings per share for the current fiscal year.

The firm also recently declared a quarterly dividend, which will be paid on Friday, March 29th. Shareholders of record on Friday, March 15th will be issued a $0.40 dividend. The ex-dividend date is Thursday, March 14th. This represents a $1.60 annualized dividend and a dividend yield of 9.32%. This is a boost from Ares Capital’s previous quarterly dividend of $0.39. Ares Capital’s dividend payout ratio (DPR) is presently 92.86%.

In related news, CFO Penelope F. Roll sold 6,000 shares of the firm’s stock in a transaction dated Tuesday, November 20th. The stock was sold at an average price of $16.76, for a total transaction of $100,560.00. Following the transaction, the chief financial officer now directly owns 11,147 shares of the company’s stock, valued at approximately $186,823.72. The sale was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CEO R. Kipp Deveer acquired 50,000 shares of the firm’s stock in a transaction that occurred on Friday, December 14th. The shares were purchased at an average cost of $16.02 per share, for a total transaction of $801,000.00. Following the completion of the acquisition, the chief executive officer now owns 225,000 shares in the company, valued at approximately $3,604,500. The disclosure for this purchase can be found here. In the last ninety days, insiders acquired 50,600 shares of company stock worth $810,730. Insiders own 0.49% of the company’s stock.

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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.

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