Michael J. Arougheti, the Co-Founder, CEO and President of Ares Management Corp (NYSE:ARES), has sold a substantial number of shares in the company, according to recent filings. Over a series of transactions, Arougheti disposed of shares worth over $8 million, with individual sale prices ranging from $144.63 to $146.39.
The series of sales took place on three consecutive days, starting on August 28 and ending on August 30, 2024. The transactions were carried out under a pre-arranged 10b5-1 trading plan, a tool that allows insiders to sell shares at predetermined times to avoid accusations of insider trading.
On the first day, Arougheti sold shares at prices fluctuating between $144.61 and $145.60, followed by a range of $144.35 to $145.34 on the second day, and concluding with prices ranging from $144.00 to $146.40 on the final day. These price ranges represent the weighted average prices of the shares sold on each respective day, indicating that the sales were executed in multiple transactions at varying prices within the stated ranges.
Arougheti's transactions have been publicly disclosed as required by securities regulations, providing transparency into the trading activities of company insiders. It is not uncommon for executives to sell shares for personal financial planning reasons, and such sales are often scheduled in advance to comply with market regulations.
The sales have reduced Arougheti's direct holdings in Ares Management Corp, but it is worth noting that the CEO still has indirect exposure to the company's stock through Atticus Enterprises LLC, as indicated in the filing.
Investors and market watchers often pay close attention to insider transactions as they can provide insights into the leadership's view of the company's future prospects. However, it is important to consider that such transactions do not always signal a change in company outlook and may be influenced by a variety of personal factors.
Ares Management Corp, with its headquarters in Los Angeles, California, provides investment management and advice to clients across the globe. As of the date of the report, the company has not provided any additional comments on the transactions.
In other recent news, the National Football League (NFL) has allowed private equity firms to acquire up to 10% stakes in its teams, a decision that marks a significant change in the league's ownership structure. Firms such as Ares Management, Arctos Partners, Sixth Street, and a consortium composed of Blackstone (NYSE:BX), Carlyle, CVC, and Dynasty Equity are prepared to commit a substantial $12 billion to this venture. These developments are part of recent changes in the NFL's ownership policies.
In the meantime, Ares Management has been rated Neutral by Redburn-Atlantic, which acknowledges the strength of Ares' origination network, particularly within its European direct lending business. However, the firm also pointed out potential challenges due to increasing competition in private credit markets. TD Cowen has shown confidence in Ares Management by raising its price target from $158.00 to $162.00.
Automated Industrial Robotics Inc. (AIR) has acquired UK-based Sewtec Automation, a move aimed at expanding its global presence and engineering capabilities. This acquisition was primarily funded by an investment from a private equity fund managed by Ares Management.
Hyatt Hotels (NYSE:H) Corporation has sold Hyatt Regency Orlando and an adjacent land parcel for approximately $1.07 billion to RIDA Development Corporation and an Ares Management Real Estate fund. This transaction is part of Hyatt's strategy to divest owned properties.
Lastly, Ares Management Corporation declared a third-quarter common dividend of $0.93 per share, marking a 21% increase from the previous year, and reported a record $447 billion in assets under management, an 18% increase year-over-year.
InvestingPro Insights
As market participants digest the news of Michael J. Arougheti's share sales, it's essential to consider the financial health and future prospects of Ares Management Corp (NYSE:ARES). According to InvestingPro, ARES has demonstrated a commitment to shareholder returns, having raised its dividend for 4 consecutive years and maintained dividend payments for 11 consecutive years. This consistency in returning value to shareholders may provide some reassurance amidst the insider selling activity.
InvestingPro data also reveals that ARES is trading at a high P/E ratio relative to near-term earnings growth, which suggests that the stock is priced at a premium based on current earnings expectations. Moreover, the company is profitable over the last twelve months and analysts predict it will remain profitable this year. While there are concerns, such as 11 analysts revising their earnings downwards for the upcoming period and short-term obligations exceeding liquid assets, the overall financial performance of ARES has been strong, with a high return over the last decade and a robust performance over the last five years.
For investors looking for more in-depth analysis, InvestingPro offers additional tips on ARES, providing a comprehensive view of the company's financials, market position, and potential investment risks and opportunities.
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