Wells Fargo has recently raised Ares Capital Corporation (ARCC) stock to Overweight rating, as announced on December 12, 2024, according to Finviz. Earlier, on December 2, 2024, Wells Fargo had raised the stock from a Equal Weight to Overweight, setting a price target of $23. B. Riley Securities also reduced Neutral rating with a price target of $21. Additionally, B. Riley Securities initiated Buy rating on June 16, 2023, with a target price of $20.50. Wells Fargo analysts, in their report published on April 18, 2023, also reduced Equal Weight rating and set a price target of $20 for Ares Capital Corporation’s stock. Analyst ratings are significant because they provide insights into stock performance expectations, influencing investor decisions and market sentiment.
Ares Capital Corporation (ARCC) Stock Trading Recap
On Tuesday, Ares Capital Corporation (ARCC) stock saw a modest uptick, ending the day at $22.43 which represents a slight increase of $0.33 or 1.49% from the prior close of $22.1. The stock opened at $22.17 and touched a low of $22.15 during the day, reaching a high of $22.43. The volume of shares traded was 2.93 million falling short of the average volume of 4.05 million.
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ARCC Stock Performance and Moving Averages
In recent trading, Ares Capital Corporation (ARCC) stock price has shown some volatility, fluctuating 1.40% over the last five trades and 1.40% over the past 30 trades. This represents a notable shift from earlier in the year. Over the last six months, the stock has risen by 6.66%, and it has gained 5.21% in the previous three months. Currently, ARCC is trading at 2.87%, 3.01%, and 6.20% relative to its 20-Day, 50-Day, and 200-Day Simple Moving Averages, respectively.
As of the latest trading close, ARCC, a Financial sector stock, is trading -0.02% below its 52-week high but remains 16.10% above its 52-week low. The Average True Range (ATR) (14 days) of 0.26 highlights the stock’s average volatility, providing insight into how much the price typically fluctuates. This measure is crucial for understanding potential price swings and assessing overall market risk.
Ares Capital Corporation’s Profitability and Valuation Ratios
Ares Capital Corporation’s profitability metrics reveal financial health. The company currently boasts a gross margin of 6.66%. The profit margin, also known as the revenue ratio or gross profit ratio, measures how efficiently a company converts sales into net income; higher margins indicate greater profitability.
In terms of valuation, Ares Capital Corporation’s market capitalization stands at $14.49 billion. Market cap represents the total value of all outstanding shares and is a key indicator of a company’s market value. The stock’s price-to-earnings (P/E) ratio is 8.63, assessing the company’s valuation relative to its earnings. The forward P/E ratio, which uses projected earnings for the next financial year, is 10.16. Additionally, the Price-to-Sales Ratio is 4.93, reflecting the market’s valuation of the company’s sales, while the Price-to-Book Ratio is 1.13, comparing the market value to the company’s book value.
Understanding Insider Trading
Investors often prefer to invest in shares held by company insiders, as management is typically more aligned with the company’s success and shareholder interests. Currently, insiders own just 0.53% of Ares Capital Corporation (ARCC)’s shares, while financial institutions hold 29.79%.