Is this U.S.-China selloff a buy? A top Wall Street voice weighs in
Investing.com - RBC Capital has reduced its price target on Ares Management, L.P. (NYSE:ARES) to $190.00 from $215.00 while maintaining an Outperform rating on the stock. According to InvestingPro data, analyst targets for the $48.35 billion asset manager range from $155 to $215, with current technical indicators suggesting the stock is in oversold territory.
The firm continues to view Ares Management as a "favorite name" and suggests that recent share underperformance could provide "an attractive entry point for investors." The stock has experienced notable decline recently, with a -15.07% year-to-date return, while maintaining strong fundamentals including impressive revenue growth of nearly 50% over the last twelve months.
RBC Capital recently attended a sell-side analyst teach-in hosted by Ares Management’s senior management, gaining further appreciation of growth opportunities for the company outside of credit and direct lending.
The firm noted that real estate has become Ares Management’s second-largest segment, with fundamentals that "seem poised to improve," according to management.
Recent management commentary indicates that deal pipelines have been picking up in August, and capital deployment trends could strengthen in the second half of the year.
In other recent news, Ares Management Corporation has successfully raised approximately $5.3 billion for its Infrastructure Secondaries strategy. This includes the final closing of the Ares Secondaries Infrastructure Solutions III fund, which exceeded its initial target by securing $3.3 billion in equity commitments. In a separate development, Ares Management’s Infrastructure Opportunities strategy acquired a 49% stake in a renewable energy portfolio valued at approximately $2.9 billion. This portfolio, acquired from EDP Renováveis, S.A., comprises 10 assets with a combined capacity of 1,632 megawatts.
On the analyst front, Citizens has reaffirmed its Market Outperform rating for Ares Management with a $205 price target, viewing the market weakness as a buying opportunity. Meanwhile, BMO Capital initiated coverage with a Market Perform rating and a $156 price target, citing Ares Management’s strong private credit capabilities. RBC Capital also maintained its Outperform rating with a $215 price target, emphasizing growth opportunities in Ares Management’s real estate segment. These recent developments reflect a dynamic period for Ares Management, marked by significant fundraising achievements and strategic investments.
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