Latest news with #AresCapital
Business Insider
01-06-2025
- Business
- Business Insider
Ares Capital (ARCC) Gets a Buy from Bank of America Securities
Bank of America Securities analyst Derek Hewett reiterated a Buy rating on Ares Capital (ARCC – Research Report) on May 30 and set a price target of $23.00. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Hewett covers the Real Estate sector, focusing on stocks such as AGNC Investment, Apollo Real Estate, and Safehold. According to TipRanks, Hewett has an average return of 6.9% and a 64.85% success rate on recommended stocks. Ares Capital has an analyst consensus of Strong Buy, with a price target consensus of $22.13.
Yahoo
27-05-2025
- Business
- Yahoo
Ares Capital Corporation Prices Public Offering of $750 Million 5.500% Unsecured Notes Due 2030
NEW YORK, May 27, 2025--(BUSINESS WIRE)--Ares Capital Corporation (Nasdaq: ARCC) announced that it has priced an underwritten public offering of $750 million in aggregate principal amount of 5.500% notes due 2030. The notes will mature on September 1, 2030 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. BofA Securities, Inc., J.P. Morgan Securities LLC, RBC Capital Markets, LLC, SMBC Nikko Securities America, Inc., Wells Fargo Securities, LLC, Barclays Capital Inc., BNP Paribas Securities Corp., CIBC World Markets Corp., Mizuho Securities USA LLC, MUFG Securities Americas Inc. and Truist Securities, Inc. are acting as joint book-running managers for this offering. HSBC Securities (USA) Inc., Morgan Stanley & Co. LLC, Regions Securities LLC, SG Americas Securities, LLC, BNY Mellon Capital Markets, LLC, Capital One Securities, Inc., Goldman Sachs & Co. LLC, ICBC Standard Bank Plc, Natixis Securities Americas LLC and U.S. Bancorp Investments, Inc. are acting as joint lead managers for this offering. Ares Management Capital Markets LLC, Deutsche Bank Securities Inc., ING Financial Markets LLC, R. Seelaus & Co., LLC, Academy Securities, Inc., Citigroup Global Markets Inc., Keefe, Bruyette & Woods, Inc., Loop Capital Markets LLC, Samuel A. Ramirez & Company, Inc. and Siebert Williams Shank & Co., LLC are acting as co-managers for this offering. The offering is expected to close on June 3, 2025, subject to customary closing conditions. Ares Capital expects to use the net proceeds of this offering to repay certain outstanding indebtedness under its debt facilities. Ares Capital may reborrow under its debt facilities for general corporate purposes, which include investing in portfolio companies in accordance with its investment objective. Investors are advised to carefully consider the investment objective, risks, charges and expenses of Ares Capital before investing. The pricing term sheet dated May 27, 2025, the preliminary prospectus supplement dated May 27, 2025, and the accompanying prospectus dated May 1, 2024, each of which have been filed with the Securities and Exchange Commission, contain this and other information about Ares Capital and should be read carefully before investing. The information in the pricing term sheet, the preliminary prospectus supplement, the accompanying prospectus and this press release is not complete and may be changed. The pricing term sheet, the preliminary prospectus supplement, the accompanying prospectus and this press release are not offers to sell any securities of Ares Capital and are not soliciting an offer to buy such securities in any jurisdiction where such offer and sale is not permitted. The offering may be made only by means of a preliminary prospectus supplement and an accompanying prospectus. Copies of the preliminary prospectus supplement (and accompanying prospectus) may be obtained from BofA Securities, Inc., NC1-022-02-25, 201 North Tryon Street, Charlotte, NC 28255-0001, Attn: Prospectus Department, or by calling 1-800-294-1322, or email J.P. Morgan Securities LLC, 383 Madison Avenue, New York, NY 10179, Attn: Investment Grade Syndicate Desk, 1-212-834-4533; RBC Capital Markets, LLC, Brookfield Place, 200 Vesey Street, 8th Floor, New York, NY 10281, by toll-free telephone at 1-866-375-6829 or email rbcnyfixedincomeprospectus@ SMBC Nikko Securities America, Inc. at 277 Park Avenue, New York, New York 10172, Attn: Debt Capital Markets, 1-212-224-5135; or Wells Fargo Securities, LLC at 608 2nd Avenue South, Suite 1000, Minneapolis, MN 55402, Attn: WFS Customer Service, or email wfscustomerservice@ or by calling 1-800-645-3751. ABOUT ARES CAPITAL CORPORATION Founded in 2004, Ares Capital is a leading specialty finance company focused on providing direct loans and other investments in private middle market companies in the United States. Ares Capital's objective is to source and invest in high-quality borrowers that need capital to achieve their business goals, which oftentimes can lead to economic growth and employment. Ares Capital believes its loans and other investments in these companies can help generate attractive levels of current income and potential capital appreciation for investors. Ares Capital, through its investment manager, utilizes its extensive, direct origination capabilities and incumbent borrower relationships to source and underwrite predominantly senior secured loans but also subordinated debt and equity investments. Ares Capital has elected to be regulated as a business development company ("BDC") and was the largest publicly traded BDC by market capitalization as of March 31, 2025. Ares Capital is externally managed by a subsidiary of Ares Management Corporation (NYSE: ARES), a publicly traded, leading global alternative investment manager. FORWARD-LOOKING STATEMENTS Statements included herein may constitute "forward-looking statements," which relate to future events or Ares Capital's future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and conditions may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Ares Capital's filings with the Securities and Exchange Commission. Ares Capital undertakes no duty to update any forward-looking statements made herein. View source version on Contacts INVESTOR RELATIONS CONTACTS Ares Capital CorporationJohn Stilmar or Carl Drake888-818-5298irarcc@ Sign in to access your portfolio
Business Wire
27-05-2025
- Business
- Business Wire
Ares Capital Corporation Prices Public Offering of $750 Million 5.500% Unsecured Notes Due 2030
NEW YORK--(BUSINESS WIRE)--Ares Capital Corporation (Nasdaq: ARCC) announced that it has priced an underwritten public offering of $750 million in aggregate principal amount of 5.500% notes due 2030. The notes will mature on September 1, 2030 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. BofA Securities, Inc., J.P. Morgan Securities LLC, RBC Capital Markets, LLC, SMBC Nikko Securities America, Inc., Wells Fargo Securities, LLC, Barclays Capital Inc., BNP Paribas Securities Corp., CIBC World Markets Corp., Mizuho Securities USA LLC, MUFG Securities Americas Inc. and Truist Securities, Inc. are acting as joint book-running managers for this offering. HSBC Securities (USA) Inc., Morgan Stanley & Co. LLC, Regions Securities LLC, SG Americas Securities, LLC, BNY Mellon Capital Markets, LLC, Capital One Securities, Inc., Goldman Sachs & Co. LLC, ICBC Standard Bank Plc, Natixis Securities Americas LLC and U.S. Bancorp Investments, Inc. are acting as joint lead managers for this offering. Ares Management Capital Markets LLC, Deutsche Bank Securities Inc., ING Financial Markets LLC, R. Seelaus & Co., LLC, Academy Securities, Inc., Citigroup Global Markets Inc., Keefe, Bruyette & Woods, Inc., Loop Capital Markets LLC, Samuel A. Ramirez & Company, Inc. and Siebert Williams Shank & Co., LLC are acting as co-managers for this offering. The offering is expected to close on June 3, 2025, subject to customary closing conditions. Ares Capital expects to use the net proceeds of this offering to repay certain outstanding indebtedness under its debt facilities. Ares Capital may reborrow under its debt facilities for general corporate purposes, which include investing in portfolio companies in accordance with its investment objective. Investors are advised to carefully consider the investment objective, risks, charges and expenses of Ares Capital before investing. The pricing term sheet dated May 27, 2025, the preliminary prospectus supplement dated May 27, 2025, and the accompanying prospectus dated May 1, 2024, each of which have been filed with the Securities and Exchange Commission, contain this and other information about Ares Capital and should be read carefully before investing. The information in the pricing term sheet, the preliminary prospectus supplement, the accompanying prospectus and this press release is not complete and may be changed. The pricing term sheet, the preliminary prospectus supplement, the accompanying prospectus and this press release are not offers to sell any securities of Ares Capital and are not soliciting an offer to buy such securities in any jurisdiction where such offer and sale is not permitted. The offering may be made only by means of a preliminary prospectus supplement and an accompanying prospectus. Copies of the preliminary prospectus supplement (and accompanying prospectus) may be obtained from BofA Securities, Inc., NC1-022-02-25, 201 North Tryon Street, Charlotte, NC 28255-0001, Attn: Prospectus Department, or by calling 1-800-294-1322, or email J.P. Morgan Securities LLC, 383 Madison Avenue, New York, NY 10179, Attn: Investment Grade Syndicate Desk, 1-212-834-4533; RBC Capital Markets, LLC, Brookfield Place, 200 Vesey Street, 8th Floor, New York, NY 10281, by toll-free telephone at 1-866-375-6829 or email rbcnyfixedincomeprospectus@ SMBC Nikko Securities America, Inc. at 277 Park Avenue, New York, New York 10172, Attn: Debt Capital Markets, 1-212-224-5135; or Wells Fargo Securities, LLC at 608 2nd Avenue South, Suite 1000, Minneapolis, MN 55402, Attn: WFS Customer Service, or email wfscustomerservice@ or by calling 1-800-645-3751. ABOUT ARES CAPITAL CORPORATION Founded in 2004, Ares Capital is a leading specialty finance company focused on providing direct loans and other investments in private middle market companies in the United States. Ares Capital's objective is to source and invest in high-quality borrowers that need capital to achieve their business goals, which oftentimes can lead to economic growth and employment. Ares Capital believes its loans and other investments in these companies can help generate attractive levels of current income and potential capital appreciation for investors. Ares Capital, through its investment manager, utilizes its extensive, direct origination capabilities and incumbent borrower relationships to source and underwrite predominantly senior secured loans but also subordinated debt and equity investments. Ares Capital has elected to be regulated as a business development company ('BDC') and was the largest publicly traded BDC by market capitalization as of March 31, 2025. Ares Capital is externally managed by a subsidiary of Ares Management Corporation (NYSE: ARES), a publicly traded, leading global alternative investment manager. Statements included herein may constitute 'forward-looking statements,' which relate to future events or Ares Capital's future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and conditions may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Ares Capital's filings with the Securities and Exchange Commission. Ares Capital undertakes no duty to update any forward-looking statements made herein.
Yahoo
22-05-2025
- Business
- Yahoo
Should You Buy Ultra-High-Yielding Ares Capital Corporation While It's Below $22.50?
Ares Capital Corporation offers a notable dividend yield of 8.7%, significantly higher than the S&P 500 index. The company lends to medium-sized companies often underserved by the banking system today. Ares Capital is the largest BDC in the U.S., and is well-positioned to capitalize on the market for private capital lending. 10 stocks we like better than Ares Capital › If you're looking for an easy way to boost your passive income, consider investing in dividend stocks. One standout dividend stock is Ares Capital Corporation (NASDAQ: ARCC). With a dividend yield of 8.7%, Ares Capital pays a dividend over seven times that of the S&P 500 index. Ares Capital plays a key role by providing loans to mid-sized businesses, which are overlooked by traditional banks. With a solid track record of navigating economic downturns, Ares has proven its ability to manage risks effectively. However, the stock has experienced some turbulence recently, amid market volatility stemming from economic uncertainty. If you're considering adding ultra-high-yielding Ares Capital to your portfolio, here's what you need to know first. Ares Capital operates as a business development corporation (BDC), an attractive investment structure for those seeking high-yield income. When set up as a Regulated Investment Company, BDCs must distribute at least 90% of their taxable income to shareholders, allowing investors to benefit directly from the corporation's profitability. Ares Capital specifically targets middle-market companies -- those with earnings before interest, taxes, depreciation, and amortization (EBITDA) ranging from $10 million to $250 million. These mid-sized companies often find themselves underserved by traditional banks, which may shy away from lending due to their smaller size and the perceived credit risks involved. In recent decades, the number of banks has declined significantly due to consolidation. Coupled with stricter regulations following the Great Recession, banks have shifted their focus toward larger businesses, which they deem to carry less risk and offer more liquid debt. As a result, banks' share of the senior secured loan market has plummeted, creating a lending opportunity for BDCs like Ares Capital. Another aspect that makes Ares Capital appealing for investors is its use of floating-rate loans, which adjust with changes in interest rates. As rates rise, so too can Ares' income, enabling the potential for increased dividend payments to investors. Managing debt within middle-market companies presents unique challenges that investors should be aware of. Unlike larger corporations, these companies often have less flexibility and may be more susceptible to risks, especially during times of economic uncertainty characterized by inflation, rising tariffs, and supply chain disruptions. One thing to watch is credit quality. Non-accrual loans are those where principal or interest payments are 30 days overdue or when there's substantial doubt regarding their collection. An uptick in this ratio could indicate increasing credit risk, but current data suggests stability in this area. Currently, loans in non-accrual status account for just 0.9% of Ares Capital's total investments at fair value, a slight improvement from 1% at the end of the previous quarter. One way Ares mitigates some of this risk is by investing in first-lien or second-lien senior secured loans, which account for 64% of its total loans. This positions it as one of the first creditors to be paid during liquidation events. It also has 566 companies in its portfolio, and its largest single investment is only 2% of its portfolio. For now, concerns over credit quality are muted, but it's also worth noting that the first quarter didn't reflect the effect of trade tariffs. Investors should continue to monitor this in upcoming quarters as tariffs work their way through the economy. Ares has a proven track record of success across different economic environments. Since its founding in 2004, the company has delivered excellent total returns (including reinvested dividends) of 12.9% annually -- outperforming the S&P 500 index along the way. Ares Capital Corporation is the largest BDC in the U.S. and has a 20-year lending history to middle-market companies. The company has extensive knowledge of key markets and industries and has invested $160 billion since its inception. With a total addressable market of $5.4 trillion and a longer-term shift to alternative investments like private capital lending, ultra-high-yielding Ares Capital Corporation is well-positioned to grow and capitalize on future opportunities. Before you buy stock in Ares Capital, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Ares Capital wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $642,582!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $829,879!* Now, it's worth noting Stock Advisor's total average return is 975% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Courtney Carlsen has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Should You Buy Ultra-High-Yielding Ares Capital Corporation While It's Below $22.50? was originally published by The Motley Fool
Yahoo
22-05-2025
- Business
- Yahoo
ARCC vs. HTGC: Which BDC Has More Upside Amid Market Uncertainty?
Ares Capital Corporation ARCC and Hercules Capital, Inc. HTGC are two leading Business Development Companies (BDCs) that provide debt financing to private companies. While ARCC focuses on middle-market firms across various industries, HTGC carves out a niche in venture debt, targeting high-growth technology and life sciences today's environment of elevated interest rates, sluggish economic activity and ongoing ambiguity surrounding potential Trump-era tariffs, BDCs face mounting headwinds. Subdued refinancing demand and slower transactional activity are likely to weigh on total investment income, while elevated rates and geopolitical risks pose a threat to asset quality as borrowers face increased debt-servicing pressure. As such, ARCC and HTGC have experienced stock declines. YTD Price Performance Image Source: Zacks Investment Research Against this backdrop, a question arises: which BDC stock is better positioned, Ares Capital with its broad exposure and scale or Hercules Capital with its tech-focused growth strategy? Let's dive into their fundamentals, financial performance and growth outlook to find out which one presents a more compelling opportunity right now. Ares Capital's investments in corporate borrowers generally range from $30 million to $500 million, while its investments in power generation projects are between $10 million and $200 million. It offers customized financing solutions, ranging from senior debt instruments to equity capital, with a focus on senior secured the first quarter of 2025, ARCC reported 4.4% year-over-year growth in total investment income. This was largely driven by an increase in interest income from investments, capital structuring service fees and other income. However, the company recorded lower portfolio exits and gross commitments. As such, the company's top and bottom-line numbers lagged the Zacks Consensus the last five years, Ares Capital's total investment income witnessed a CAGR of 14.4%, driven by higher demand for personalized financing solutions, leading to increased investment commitments. Also, the company originated $15.1 billion, $6 billion, $9.9 billion, $15.6 billion, $6.7 billion and $7.3 billion in 2024, 2023, 2022, 2021, 2020 and 2019, respectively, in gross investment commitments to new and existing portfolio of March 31, 2025, ARCC had a diversified investment portfolio of $27.1 billion across 566 portfolio companies. It had 24% of its investments in software & services and 13% in healthcare equipment & services. Other major investment areas were financial services, which include investment in Ivy Hill Asset Management (10%), commercial & professional services (10%) and insurance services (6%). While this reduces concentration risk and enhances the sustainability of total investment income, many of these industries are expected to face headwinds because of Trump's tariffs. Ares Capital's Investment Portfolio (by Industry) Image Source: Ares Capital Corporation Hence, ARCC's total investment income growth will likely be hampered in the near term due to relatively high interest rates, subdued demand for customized financing and delays in investment commitments amid an uncertain operating backdrop. Sales Estimates Image Source: Zacks Investment Research Hercules Capital's investments generally fall between $15 million and $40 million. It offers customized financing solutions ranging from senior debt to equity capital, with a focus on structured debt with warrants. It invests in companies that have been in business for at least six months to one year before the date of investment and expects these investments to generate revenues within at least two to four the first quarter of 2025, HTGC witnessed a 2% fall in total investment income due to a lower total fee income. Nonetheless, the company recorded a rise in gross new debt and equity commitments during the quarter. In the last decade, Hercules Capital's total investment income witnessed a CAGR of 12.1%. Additionally, the company closed $2.6 billion, $3.1 billion, $2.2 billion and $2.7 billion in new debt and equity commitments in 2021, 2022, 2023 and 2024, respectively. Driven by the rise in demand for customized financing and a robust deal pipeline, total new commitments are expected to keep rising. Total Investment Income Image Source: Hercules Capital, Inc. As of March 31, 2025, HTGC had an investment portfolio of $3.9 billion. It had 32% of its portfolio investments (at fair value) in software companies and 29% in drug discovery & development companies. Other major investment areas were other healthcare services (16%) and consumer & business services (10%). With a focus mainly on the technology and life science sectors, HTGC is better placed to counter tariffs. HTGC's Investment Portfolio (by Industry) Image Source: Hercules Capital, Inc. Despite several near-term headwinds, Hercules Capital is well-placed to record a rise in total investment income and commitments going forward. Sales Estimates Image Source: Zacks Investment Research The Zacks Consensus Estimate for ARCC's 2025 and 2026 earnings indicates a 12% and 0.9% decline for 2025 and 2026, respectively. Over the past month, earnings estimates for 2025 and 2026 have been revised lower. This indicates analysts' bearish sentiments. Earnings Trend Image Source: Zacks Investment Research On the contrary, analysts are more optimistic about HTGC's prospects. While the consensus mark for 2025 earnings suggests a 4% decline, for 2026, it is expected to grow 5.9%. Also, over the past 30 days, earnings estimates for 2025 have been revised lower, while it has been marginally revised north for 2026. Earnings Trend Image Source: Zacks Investment Research Valuation-wise, ARCC is currently trading at a 12-month forward price-to-earnings (P/E) of 10.54X, higher than its five-year median of 9.36X. The HTGC stock, on the other hand, is currently trading at a 12-month forward P/E of 8.83X, which is lower than its five-year median of 9.39X. P/E F12M Image Source: Zacks Investment Research Therefore, Hercules Capital is inexpensive compared to Ares HTGC's return on equity (ROE) of 16.84% is way above ARCC's 11.05%. HTGC also outscores the industry ROE of 11.20%. This reflects Hercules Capital's efficient use of shareholder funds to generate profits. ROE Image Source: Zacks Investment Research Further, HTGC's dividend yield of 9.23% is slightly higher than ARCC's 8.92%. Nonetheless, both are lower than the industry average dividend yield of 10.27%. Dividend Yield Image Source: Zacks Investment Research Despite macroeconomic headwinds, Hercules Capital is better positioned for long-term growth than Ares Capital. HTGC's focus on venture debt in high-growth tech and life sciences sectors gives it an edge, along with a strong return on equity of 16.84%—well above ARCC's and the industry average. Its rising investment commitments and projected earnings growth for 2026 signal strong momentum. HTGC also trades below its five-year median P/E, offering an attractive contrast, ARCC's broader industry exposure makes it more vulnerable to tariff-related risks. Its earnings estimates have been revised downward, and its premium valuation limits near-term upside. While ARCC offers income stability through its diversified portfolio and strong dividends, HTGC's sector focus, higher efficiency and better earnings trajectory make it a more compelling choice for investors seeking solid long-term present, HTGC carries a Zacks Rank of 3 (Hold), while Ares Capital has a Zacks Rank #4 (Sell).You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ares Capital Corporation (ARCC) : Free Stock Analysis Report Hercules Capital, Inc. (HTGC) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
