Ares Management stock rating reaffirmed by Citizens amid private credit concerns

Published 09/10/2025, 10:06
Ares Management stock rating reaffirmed by Citizens amid private credit concerns

Investing.com - Citizens has reiterated its Market Outperform rating and $205.00 price target on Ares Management, L.P. (NYSE:ARES) despite growing concerns about private credit portfolio quality. The company, currently trading at $149.80, has demonstrated strong financial health with a 49.9% revenue growth over the last twelve months and maintains a solid 38% gross profit margin, according to InvestingPro data.

The research firm indicated it views the recent market weakness as a buying opportunity, noting that many investors still don’t fully understand the underlying nature of alternative asset management businesses. InvestingPro analysis shows the stock’s RSI suggests oversold territory, while the company has maintained consistent dividend payments for 12 consecutive years with a current yield of 3%.

Citizens expects strong third-quarter 2025 earnings for alternative asset managers, particularly highlighting Ares Management and Blue Owl Capital Inc. (NYSE:OWL), for which it maintains a Market Outperform rating and $28 price target.

The firm anticipates management teams will present "a particularly bullish tone" during upcoming earnings calls regarding their business models, industry positioning, and both near-term and long-term outlooks.

Citizens believes the perceived risks surrounding private credit are "overblown" and expects robust underlying fundamentals, including for capital deployment, which has positive implications for management fee growth.

In other recent news, Ares Management Corporation has successfully raised approximately $5.3 billion for its Infrastructure Secondaries strategy. This capital raise includes the final closing of the Ares Secondaries Infrastructure Solutions III fund, which exceeded its initial target by closing at around $3.3 billion in equity commitments. Additionally, Ares Management has expanded its renewable energy portfolio by acquiring a 49% stake from EDP Renováveis, S.A., valuing the entire portfolio at approximately $2.9 billion. The portfolio comprises 10 assets with a total capacity of 1,632 megawatts, secured by long-term Power Purchase Agreements.

In a separate transaction, Ares funds have acquired Meade Pipeline Co LLC for approximately $1.1 billion. This acquisition includes a significant stake in the Central Penn Line, a major pipeline transporting natural gas across several U.S. regions. On the analyst front, BMO Capital has initiated coverage on Ares Management with a Market Perform rating, while RBC Capital has maintained its Outperform rating with a $215 price target, citing growth opportunities in the company’s real estate segment. These developments highlight Ares Management’s strategic expansions and the continued interest from the investment community.

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