Ares Management’s co-founder sells over $16 million in company stock By Investing.com

Ares Management Corp (NYSE:) Co-Founder David B. Kaplan has sold a significant portion of his holdings in the company, according to a recent filing. Kaplan, who is also an officer and director at Ares, disposed of a total of 124,000 shares of Class A Common Stock on June 21, 2024, in a series of transactions totaling approximately $16,492,636.

The sales were carried out at varying prices, starting from a low of $131.41 to a high of $134.06 per share. The transactions were conducted under a 10b5-1 trading plan, which Kaplan or a controlled vehicle had adopted on March 1, 2024, allowing for pre-planned trades to be executed automatically.

Following these transactions, Kaplan’s directly owned stake in the company has been reduced to zero. However, he remains indirectly invested through Ares Owners Holdings L.P., a limited partnership in which Kaplan or a controlled vehicle is a limited partner, holding a substantial amount of Class A Common Stock.

Ares Management Corp, based in Los Angeles, California, is a leading global alternative asset manager with expertise in credit, private equity, and real estate. The company has built a strong reputation for its investment performance and client focus.

Investors often monitor the buying and selling activities of company insiders like Kaplan for insights into the company’s performance and valuation. Sales of this magnitude can sometimes signal an insider’s belief about the future prospects of the company, although they can also be motivated by personal financial management or estate planning needs.

The details of the sale, including the range of prices at which the stock was sold, are available upon request to the issuer, any security holder of the issuer, or the staff of the Securities and Exchange Commission.

In other recent news, Ares Management has made significant strategic moves, including an equity raise aiming to generate approximately $400 million, which is expected to fuel the company’s growth. The company also announced a public offering of 2,650,000 shares of its Class A common stock to fund general corporate activities. Analysts from TD Cowen and BofA Securities have maintained a positive outlook on Ares Management, reiterating Buy ratings with price targets of $171 and $181, respectively.

Deutsche Bank, however, adjusted its rating for Ares Management to Hold from Buy, setting a new price target of $132 due to a correction in the share count used in their valuation model. This adjustment does not reflect any operational changes in the company.

These recent developments highlight Ares Management’s strategic initiatives and financial performance. The firm’s focus is expected to be on expanding its retail offerings, direct lending, credit operations, and its non-U.S. presence, likely through deal-driven strategies. Analysts project an increase in earnings per share from $4.32 to $6.11 over the next two fiscal years, reflecting a positive outlook on the company’s profitability.

InvestingPro Insights

In light of the recent insider transactions at Ares Management Corp (NYSE:ARES), investors may find additional context in the company’s current financial metrics and performance. ARES has demonstrated a strong track record of dividend growth, having raised its dividend for 4 consecutive years and maintaining dividend payments for 11 consecutive years. This consistency aligns with the company’s solid financial footing and commitment to shareholder returns, as indicated by an InvestingPro Tip suggesting that ARES has had a high return over the last year.

From a valuation perspective, ARES is trading at a low Price/Earnings (P/E) ratio relative to near-term earnings growth, with a P/E Ratio (Adjusted) for the last twelve months as of Q1 2024 standing at 74.2. Despite this, the company is trading at a high Price/Book multiple of 23.83, which may suggest that the market is pricing in the quality of ARES’s assets and its future growth prospects. The company’s revenue growth for the last twelve months as of Q1 2024 was 11.8%, reflecting a healthy expansion in its business operations.

Investors considering ARES’s potential should note that the company is profitable over the last twelve months, and analysts predict it will remain profitable this year. Moreover, for those interested in a deeper dive into the company’s financials and future outlook, there are additional InvestingPro Tips available, providing valuable insights into Ares Management Corp’s performance and valuation.

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