On May 25, 2023, Michael Arougheti, Co-Founder, CEO, and President of Ares Management Corp (ARES, Financial), sold 367,539 shares of the company. This move comes amidst a year of insider trading activity that has seen Arougheti sell a total of 379,922 shares and make no purchases. In this article, we will take a closer look at Michael Arougheti, Ares Management Corp, and the relationship between insider trading and stock price.
Who is Michael Arougheti?
Michael Arougheti is the Co-Founder, CEO, and President of Ares Management Corp, a leading global alternative investment manager. With over two decades of experience in the financial industry, Arougheti has played a pivotal role in the growth and success of Ares Management Corp. Under his leadership, the company has expanded its operations and solidified its position as a key player in the alternative investment space.
Ares Management Corp's Business Description
Ares Management Corp is a global alternative investment manager that operates in the credit, private equity, and real estate sectors. The company focuses on providing flexible financing solutions to its clients, which include corporations, sovereign wealth funds, pension funds, and endowments. With a diverse range of investment strategies, Ares Management Corp aims to deliver attractive risk-adjusted returns for its investors while preserving capital and maintaining a strong focus on risk management.
Insider Buy/Sell Analysis and Relationship with Stock Price
Over the past year, there has been a total of 1 insider buy and 18 insider sells for Ares Management Corp. This trend suggests that insiders may have a bearish outlook on the company's stock. However, it is essential to consider the context of these transactions and the potential motivations behind them.
On the day of Michael Arougheti's recent sale, shares of Ares Management Corp were trading at $83.45, giving the stock a market cap of $15,394.766 million. The price-earnings ratio is 75.54, which is higher than the industry median of 12.84 and higher than the company's historical median price-earnings ratio. This indicates that the stock may be overvalued compared to its peers and historical performance.
Furthermore, with a price of $83.45 and a GuruFocus Value of $72.41, Ares Management Corp has a price-to-GF-Value ratio of 1.15. This means the stock is modestly overvalued based on its GF Value. The GF Value is an intrinsic value estimate developed by GuruFocus that takes into account historical multiples, a GuruFocus adjustment factor, and future estimates of business performance from Morningstar analysts.
It is important to note that insider trading activity can be influenced by various factors, such as personal financial needs or portfolio diversification. While the recent insider sell activity may raise concerns for some investors, it is crucial to consider the broader context and evaluate the company's fundamentals and growth prospects before making any investment decisions.
Conclusion
The recent sale of 367,539 shares by Michael Arougheti, Co-Founder, CEO, and President of Ares Management Corp, adds to the overall trend of insider sell activity for the company over the past year. With a high price-earnings ratio and a modest overvaluation based on the GF Value, investors should carefully consider the implications of this insider trading activity and conduct thorough research before making any investment decisions.
