Ares Management LP

FORTNA has entered into an agreement with holders of 74% of its funded debt and its sponsors to strengthen its financial foundation and transition ownership to existing lenders, including funds managed by Ares Management. The recapitalization is expected to reduce funded debt by approximately $1.8 billion and cut annual interest expense by more than $150 million, while providing a fully committed equity cash infusion of about $150 million from certain existing lenders. The company said it continues to operate normally and expects to complete the transaction in the coming weeks, subject to standard closing conditions. FORTNA is a global leader in automation and software for the full logistics value chain.

Asset management stocks delivered a very strong second quarter, with the five companies tracked by this analysis beating revenue consensus estimates by 8.4% on average. Ares reported revenues of $1.28 billion, up 25.6% year on year, in line with analyst expectations but with a narrow beat on AUM estimates, and its stock is up 15.6% since reporting to $143.45. Carlyle posted revenues of $1.11 billion, up 13% year on year, beating analyst expectations by 20.7%, though its stock is down 2.6% since reporting to $49.35. Artisan Partners reported revenues of $307.9 million, up 8.9% year on year, exceeding expectations by 2.3%, with the stock up 3.6% to $42.35. Blackstone reported revenues of $3.83 billion, up 23.8% year on year, beating expectations by 10.9%, and its stock is up 17.5% to $144.36. TPG reported revenues of $610.4 million, up 24.7% year on year, topping expectations by 7.8%, with the stock up 9.3% to $53.54.

Ares Management reported second quarter 2026 results including revenue of US$1,428.61 million and net income of US$150.64 million, and affirmed quarterly dividends on both common and preferred stock. The announcements contributed to a sharp short-term rebound, with a 30-day share price return of 17.49% and a 90-day gain of 16.18%, though the year-to-date return remains down 13.96% and the one-year total shareholder return is down 23.02%. Longer-term holders have still seen meaningful gains, with three- and five-year total shareholder returns of 60.64% and 131.21% respectively. The stock last closed at $143.11, slightly below a widely followed fair value estimate of about $145.24, implying it is about 1.5% undervalued. However, the current price-to-earnings ratio of 56.8 times stands far above the fair ratio of 24.5 times and the US Capital Markets industry average of 37.9 times, suggesting meaningful valuation risk if sentiment or earnings expectations shift.

Ares Management Corp. is leading a $2.2 billion direct loan to support pharmacy benefits manager MedImpact Holdings Inc.'s planned purchase of Medical Card System, Inc., a Puerto Rico-based healthcare services company. The loan could pay at least 8 percentage points over the benchmark rate and would be secured on a second-lien basis, raising borrowing costs. At $2.2 billion, the deal would be one of the largest this year in the $1.8 trillion private credit market, which has faced record redemptions and sluggish private equity dealmaking. Discussions are ongoing and details are still being finalized.

Ares Management reported record quarterly fundraising of $36 billion in the second quarter of 2026, driving a 17% year-over-year increase in total assets under management to approximately $671 billion. Fee-paying AUM rose 17% to approximately $410 billion, while management fees exceeded $1 billion for the quarter, up 14% from the prior year. Fee-related earnings grew 20% to approximately $491 million, and realized income increased 31% to approximately $522 million, with after-tax realized income per share of $1.29, a 25% gain. The company declared a quarterly dividend of $1.35 per share, over 20% higher than the same quarter a year ago, and ended the period with $170 billion of dry powder and $114 billion of AUM not yet paying fees. CEO Michael Arougheti highlighted accelerating institutional demand for private credit and noted that the firm remains on track to meet its full-year financial objectives, consistent with long-term compound annual growth targets of 16% to 20% for fee-related earnings and over 20% for realized income.

Ares Capital and Blue Owl Capital reported resilient second-quarter results, while Ares Management posted record fundraising, highlighting continued institutional demand for private credit despite rising defaults, retail redemptions and liquidity concerns. Ares Management raised a record $36 billion in the second quarter, including $23.7 billion for its credit strategies, and its assets under management rose 17% from a year earlier to $671.3 billion. Ares Capital, the largest publicly traded business development company, reported core earnings of 47 cents per share, in line with the LSEG consensus estimate, and maintained its quarterly dividend with about $6 billion of available liquidity as of July 23. Blue Owl Capital reported $319 billion of assets under management at the end of June, up 12% from a year earlier, and its distributable earnings rose 9%, matching analysts' average estimate. However, Fitch Ratings said the U.S. private-credit default rate rose to a record 6.0% in the 12 months through June, from 5.7% in the previous quarter, with 32 default events in the second quarter involving 20 new borrowers. Retail-focused private-credit funds continued to receive redemption requests well above their normal quarterly repurchase limits, with second-quarter redemption requests reaching 38.1% of net asset value at Blue Owl Technology Income Corp, 18.9% at Blue Owl Credit Income Corp and 16.8% at Apollo Debt Solutions, while most funds repurchased shares equivalent to about 5% of net asset value during the quarter. Evercore estimated global private credit secondary-market volume reached $20.4 billion in the first half of 2026, up 122% from a year earlier and exceeding the total recorded in all of 2025, with GP-led deals accounting for 83% of the total.

Ares Management Corporation reported second-quarter non-GAAP earnings per share of $1.29, beating analyst estimates by $0.02. The company also declared a quarterly dividend of $1.35 per share for its Class A and non-voting common stock, payable on September 30, 2026 to shareholders of record as of September 16, 2026.

Eni raised its stock buyback program by €600 million to €3.4 billion after second-quarter adjusted net profit more than doubled to €2.33 billion, beating analyst consensus of €2.09 billion. The Italian energy company also said it may pay an extra dividend in the fourth quarter if Brent crude prices remain substantially above its forecasts. Underlying oil and gas production grew 7% in the quarter, and Eni now targets full-year production growth of about 5%, up from a previous 3% to 4% range. Underlying cash flow from operations is expected to reach €15 billion. Separately, Eni will receive a $2 billion capital contribution from Ares Management under a partnership involving some of its oil and gas infrastructures.

Revolut has introduced private market funds on its platform for eligible customers in Europe through collaboration with Apollo, Ares, Hamilton Lane and Partners Group. The offering gives individual investors access to assets across private equity, private credit and private infrastructure through fund structures intended for non-institutional investors. The funds are set up under the EU's ELTIF 2.0 regime and are evergreen with periodic liquidity windows. Revolut, which has 75 million customers globally, said the new product is aimed at experienced investors with a long-term investment horizon. Fund management and performance fees apply.

Ares Management Corporation has completed its all-cash acquisition of Whitestone REIT for $19.00 per share, valuing the transaction at approximately $1.7 billion. The deal adds 54 convenience-focused retail properties totaling about 4.8 million square feet to Ares Real Estate's portfolio, located in fast-growing U.S. markets including Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio. Whitestone will no longer be publicly traded following the acquisition. Citigroup Global Markets Inc. served as lead financial advisor and financing provider to Ares, with Morgan Stanley also acting as financial advisor and financing provider, while BofA Securities advised Whitestone and provided a fairness opinion.

The Premier Lacrosse League has raised $100 million in its latest funding round, led by Ares Management funds and Alibaba billionaire Joe Tsai. Co-founder Paul Rabil says part of the capital will help reduce youth lacrosse expenses, where families can spend up to $25,000 annually. The league aims to lower costs to boost participation and fandom, rather than focusing on margins. Lacrosse is set to return to the Olympics in 2028 for the first time in over a century, which Rabil calls the biggest moment in the sport's history.

Ares Management is broadening investor access to its private market strategies through a new partnership with Clearstream, while also raising fresh capital via Ares Acquisition Corporation III's roughly US$395 million SPAC IPO. The Clearstream tie-up aims to plug Ares' private market strategies into Clearstream's platform, targeting broader wealth and retail channels to boost fee-paying assets under management. Analysts note that while these moves reinforce the firm's growth story, they also heighten exposure to risks such as retail flow volatility and evolving regulation. The announcements come as Ares plans a larger Asia-focused direct lending fund, underscoring its push into alternative assets. Some analysts project Ares could reach US$6.9 billion in revenue and US$1.9 billion in earnings by 2029, though more cautious estimates put earnings at US$1.5 billion, reflecting differing views on distribution costs and fee growth.

Artisan Partners reported first-quarter revenues of $303 million, a 9.3% year-on-year increase that met analyst expectations, though earnings per share significantly missed estimates. Among the five asset management stocks tracked, TPG was the best performer with revenues of $570 million, up 20.7% and beating estimates by 5.2%, while Carlyle was the weakest with revenues of $750.9 million, down 28% and missing estimates by 13%. Ares posted the fastest revenue growth at 26.2% to $1.27 billion, and Blackstone reported revenues of $3.46 billion, up 24.2% and beating estimates by 1.4%. As a group, revenues missed consensus estimates by 1.8%, and share prices have fallen an average of 8.9% since the earnings releases.

Ares Acquisition Corporation III has closed its upsized initial public offering, raising total gross proceeds of $395 million. The offering consisted of 34.5 million units sold at $10.00 each, plus an additional 5 million units sold through the partial exercise of the underwriters' over-allotment option. Each unit comprises one Class A ordinary share and one-tenth of a redeemable warrant, with each whole warrant exercisable for one Class A ordinary share at $11.50 per share. The company's sponsor is a subsidiary of Ares Management Corporation, a global alternative investment manager with approximately $644 billion in assets under management as of March 31, 2026. The units began trading on the New York Stock Exchange under the ticker symbol AAC.U on June 30, 2026.

TD Cowen raised its price target on Ares Management from $144 to $153 while reiterating a Buy rating. The adjustment follows meetings with management and reflects an updated model accounting for the treatment of X-Energy. Ares Management reported weaker-than-expected first-quarter earnings but saw assets under management growth exceed estimates, with credit quality remaining healthy. The firm raised $30 billion of gross capital in the first quarter and remains on track for another record fundraising year.

Oppenheimer downgraded several large U.S. bank stocks on Tuesday, arguing that rich valuations have left little room for further upside. The brokerage downgraded Goldman Sachs and Morgan Stanley to Underperform from Perform, while cutting Bank of America and Citigroup to Perform from Outperform. It maintained Outperform ratings on PNC Financial Services and U.S. Bancorp, recommending investors rotate into alternative asset managers such as ARES Management, Blackstone, and KKR. Oppenheimer said the banking sector has shifted from years of structural undervaluation to valuations that now reflect optimism over sustained earnings growth, with commercial banks trading near the upper end of historical valuation ranges and investment banks trading well above long-term averages. The firm raised its second-quarter 2026 earnings estimates and lifted its 2027 forecasts, now expecting the investment banking wallet to reach about 46 basis points of U.S. nominal GDP, roughly 20% to 25% above what it considers a normal level.

Ares Management held the final close of its Pathfinder Fund III above its original target, securing US$8.5 billion in commitments. The firm also expanded its infrastructure debt leadership team, appointing Brent Canada as Head of Infrastructure Debt and adding senior hires in EMEA and APAC. In addition, Ares launched a major industrial real estate development in the Raleigh Durham region in partnership with Hines, and is participating in a Bank of England stress test for private markets. The stock has fallen 32.4% year to date, closing at $112.47.

StockStory highlights Ares Management as a mid-cap stock to own for decades, while questioning Lennar and Elanco Animal Health. Ares, with a market cap of $29.95 billion, posted 23.2% annual revenue growth and 21.3% annual EPS growth over the past five years, and trades at 20.1 times forward P/E. Lennar, a $23.32 billion homebuilder, saw its backlog decline by an average of 9.2% and EPS fall 8.9% annually despite revenue growth, and trades at 13.2 times forward P/E. Elanco, a $12.01 billion animal health company, grew revenue just 4.9% annually, saw its adjusted operating margin shrink by 2.9 percentage points, and trades at 22.4 times forward P/E.

Ares Management Corporation appears better positioned than KKR & Co. Inc. for long-term shareholder returns, according to a Zacks Investment Research analysis. ARES benefits from stronger earnings growth expectations, with consensus estimates implying year-over-year rises of 27.3% for 2026 and 24.4% for 2027, and offers a significantly higher dividend yield of 4.2% after a 20.5% quarterly dividend hike to $1.35 per share. KKR trades at a lower forward price-to-earnings multiple of 15.7X versus ARES' 19.14X and targets at least $1 trillion in assets under management by 2030, but its dividend yield stands at just 0.8%. Both firms carry a Zacks Rank #3 (Hold).

Ares Management has posted a 23.2% compound annual revenue growth rate and 21.3% annual EPS growth over the past five years, underscoring strong momentum and profitability. The stock has fallen 22.3% in the last six months to $129.45, partly due to softer quarterly results, and now trades at 21.5 times forward earnings. The firm, which originated from Apollo Management’s leveraged finance group, manages private equity, credit, real estate, and infrastructure assets for institutional and high-net-worth clients.