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David B. Kaplan, Co-Founder of Ares Management Corp (NYSE:ARES), has recently sold a significant portion of his holdings in the company. According to a recent SEC filing, Kaplan disposed of shares totaling approximately $15.2 million over two days, November 25 and 26, 2024. The sale prices ranged from $174.52 to $178.52 per share.
Kaplan's transactions involved multiple sales of Class A Common Stock. On November 25, he sold shares at weighted average prices between $173.99 and $177.99, while on November 26, sales were executed at prices ranging from $175.10 to $178.83. Following these transactions, Kaplan, through Trently Holdings, LLC, retains ownership of 30,680 shares.
These transactions were conducted under a 10b5-1 trading plan adopted on August 16, 2024, allowing for pre-scheduled sales of securities. This plan provides a measure of protection for insiders against accusations of insider trading.
In other recent news, Ares Management Corporation showcased robust growth in its third-quarter earnings, including an 18% rise in management fees, a 24% bump in fee-related earnings, and a 28% growth in realized income. The company's global deployment reached nearly $30 billion for the quarter, contributing to a year-to-date total of $74.6 billion. In the same period, Ares raised almost $21 billion, marking a record-breaking fundraising effort. RBC Capital Markets recently updated its outlook on Ares, lifting the price target to $185, citing the company's resilience in fundraising and its position within the private credit sector. Despite slightly revised down earnings per share estimates, RBC maintains an Outperform rating on Ares. It's worth noting that Ares Management anticipates a decrease in the Fee-Related Earnings margin to around 40% in Q4 due to various factors, including increased compensation costs. However, the company projects strong Q4 performance with anticipated fee-related performance revenues between $160 million and $170 million, and expects continued growth in Assets Under Management and performance income in 2025 and beyond.
InvestingPro Insights
David B. Kaplan's recent sale of Ares Management Corp (NYSE:ARES) shares comes at a time when the company's stock is trading near its 52-week high, as indicated by InvestingPro data. The stock's current price is 99.97% of its 52-week high, suggesting strong recent performance. This aligns with the impressive 68.66% one-year price total return and 53.45% year-to-date return reported by InvestingPro.
The timing of Kaplan's sale is particularly interesting given Ares Management's valuation metrics. InvestingPro data shows the company trading at a high P/E ratio of 80.2, which could indicate that the stock is priced at a premium compared to its earnings. This high valuation might have influenced Kaplan's decision to sell a portion of his holdings.
InvestingPro Tips highlight that Ares has raised its dividend for 5 consecutive years and has maintained dividend payments for 11 consecutive years. This consistent dividend policy, coupled with a current dividend yield of 2.08%, may be attractive to income-focused investors despite the recent insider sale.
It's worth noting that InvestingPro offers 12 additional tips for Ares Management, providing a more comprehensive analysis for investors interested in delving deeper into the company's prospects.
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