Michael J. Arougheti, Co-Founder, CEO, and President of Ares Management Corp (NYSE:ARES), has recently sold shares worth approximately $9.49 million. The transactions, disclosed in a recent SEC filing, involved multiple sales of Class A Common Stock over several days.
On November 15, 2024, Arougheti sold 16,732 shares at an average price of $167.33 and 3,364 shares at an average price of $168. These transactions were part of a series of sales that continued on subsequent days. On November 18, he sold 3,700 shares at $166.75 and 12,125 shares at $167.39. The following day, November 19, saw further sales of 1,745 shares at $166.91, 2,500 shares at $168.43, 4,144 shares at $168.99, and 12,136 shares at $170.10.
These sales were conducted under a pre-arranged 10b5-1 trading plan, which allows company executives to sell a predetermined number of shares at a predetermined time. After these transactions, Arougheti holds 193,554 shares indirectly through Atticus Enterprises LLC.
The filing also noted a conversion of 250,000 Ares Operating Group Units into Class A Common Stock on November 15, 2024, but this was not part of the sales transactions.
In other recent news, Ares Management has demonstrated robust growth in its third-quarter earnings. The company reported an 18% rise in management fees, a 24% increase in fee-related earnings, and a 28% growth in realized income. Ares Management has also been active in the global market, deploying nearly $30 billion in the quarter, contributing to a total of $74.6 billion for the year. Record-breaking fundraising efforts have also been noted, with nearly $21 billion raised in the third quarter alone.
Furthermore, RBC (TSX:RY) Capital Markets has increased the price target for Ares Management to $185, maintaining an Outperform rating on the company's shares. This decision reflects a revised perspective on the firm's financial potential and its position within the private credit sector. Despite slightly revised down earnings per share estimates, RBC acknowledges the potential resilience in Ares Management's fundraising momentum.
Lastly, Ares Management has launched new products, including a special opportunities fund and a tax-efficient core infrastructure fund, diversifying its portfolio. Despite projecting a decrease in the fee-related earnings margin to around 40% in Q4 due to increased compensation costs, the company anticipates strong Q4 performance with fee-related performance revenues between $160 million and $170 million. These are the recent developments surrounding Ares Management.
InvestingPro Insights
To provide context to Michael J. Arougheti's recent stock sales, it's worth examining Ares Management Corp's current financial position and market performance. According to InvestingPro data, Ares Management has a substantial market capitalization of $53.0 billion, indicating its significant presence in the asset management industry.
The company's stock has shown remarkable performance, with a 61.47% total return over the past year and a 46.18% return year-to-date. This strong performance aligns with an InvestingPro Tip highlighting Ares' high return over the last year. Additionally, the stock is trading near its 52-week high, with the current price at 96.93% of its peak, suggesting investor confidence in the company's prospects.
Despite the positive market sentiment, it's important to note that Ares is trading at a high earnings multiple, with a P/E ratio of 76.67. This valuation metric, coupled with the InvestingPro Tip indicating that the company is trading at a high Price / Book multiple of 25.98, suggests that investors are pricing in significant future growth expectations.
For investors seeking more comprehensive analysis, InvestingPro offers 12 additional tips that could provide deeper insights into Ares Management's financial health and market position. These tips could be particularly valuable in understanding the context of insider transactions like those of CEO Arougheti.
The InvestingPro data and tips offer a nuanced view of Ares Management's financial position, potentially shedding light on the timing and nature of the CEO's stock sales. While the company shows strong market performance and growth, the high valuation multiples suggest that careful consideration is warranted for potential investors.
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