In a recent transaction, Bennett Rosenthal, Co-Founder and Chairman of Private Equity Group at Ares Management Corp (NYSE:ARES), sold a significant portion of his holdings in the company. The series of sales, which took place on September 3, 2024, totaled over $3.7 million in value, with share prices ranging from $142.14 to $145.10.
The transactions involved the sale of 16,295 shares at an average price of $142.14, 6,314 shares at an average price of $143.05, 3,070 shares at an average price of $143.88, and 900 shares at an average price of $145.10. Following these sales, Rosenthal's directly owned stake in the company decreased, although he still indirectly holds a significant number of shares through BAR Holdings, LLC, and as a limited partner in Ares Owners Holdings L.P.
Investors often monitor insider sales for insights into executive sentiment about their company's stock, although such sales can also reflect personal financial management decisions by the insiders. It's worth noting that the transactions were conducted in accordance with a pre-arranged 10b5-1 trading plan, which allows insiders to sell shares at predetermined times to avoid accusations of trading on non-public information.
Ares Management Corp, known for its focus on alternative asset management, including credit, private equity, and real estate investments, has not yet commented on these transactions. The sales were publicly disclosed through a Form 4 filing with the Securities and Exchange Commission.
For investors tracking insider activity, these sales provide up-to-date information about the actions of Ares Management's top executives. Rosenthal remains a key figure in the company, with his involvement in the firm extending beyond the scope of his current holdings.
In other recent news, the National Football League (NFL) has made a significant shift in its ownership structure by permitting private equity firms to acquire up to 10% stakes in its teams. Ares Management, Arctos Partners, Sixth Street, and a consortium of Blackstone (NYSE:BX), Carlyle, CVC, and Dynasty Equity have been approved to invest a significant $12 billion into the league. This development follows a decision made during a special league meeting by the NFL's 32 team owners.
In parallel, Redburn-Atlantic has initiated coverage on Ares Management with a Neutral rating, recognizing the strength of Ares' origination network, particularly within its European direct lending business. TD Cowen has also shown confidence in Ares Management by raising its price target from $158.00 to $162.00.
Furthermore, Automated Industrial Robotics Inc. (AIR) has acquired UK-based Sewtec Automation, a move that aligns with AIR’s growth strategy and was primarily funded by an investment from a private equity fund managed by Ares Management.
Additionally, Hyatt Hotels (NYSE:H) Corporation has sold Hyatt Regency Orlando and an adjacent parcel of land for approximately $1.07 billion to RIDA Development Corporation and an Ares Management Real Estate fund. This transaction aligns with Hyatt's strategy to divest owned properties, generating $2.6 billion in gross proceeds over the past three years.
Finally, Ares Management reported 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. These recent developments highlight the strategic moves of both Hyatt Hotels Corporation and Ares Management Corporation.
InvestingPro Insights
The recent insider sales by Bennett Rosenthal at Ares Management Corp (NYSE:ARES) have caught the attention of many investors, offering a glimpse into executive sentiment. To provide further context, let's delve into some key metrics and insights from InvestingPro that may help investors better understand the company's current financial landscape.
As of the last twelve months leading up to Q2 2024, Ares Management Corp boasts a robust market capitalization of $43.97 billion. However, investors should be aware that the company is trading at a high earnings multiple, with a P/E ratio of 70.86 and an adjusted P/E ratio of 94.74. This indicates that the stock may be priced at a premium compared to its earnings. Additionally, the PEG ratio, which stands at 5.01, suggests that the company's earnings growth does not fully justify the high P/E ratio.
Despite a decrease in revenue growth by -11.64% over the same period, Ares Management has maintained a solid gross profit margin of 48.01%. This demonstrates the company's ability to retain a significant portion of its sales as gross profit. Moreover, Ares has shown a commitment to rewarding its shareholders, raising its dividend for four consecutive years, with a notable dividend growth of 20.78% in the last twelve months leading up to Q2 2024.
For those interested in more detailed analysis, InvestingPro offers additional insights into Ares Management Corp. There are 11 more InvestingPro Tips available, which cover various aspects of the company's financial health and market performance. These tips can be accessed at https://www.investing.com/pro/ARES, providing investors with a comprehensive toolkit to make informed decisions.
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