NEW YORK (TheStreet) -- Shares of American Capital  (ACAS) rose 7.67% to $15.78 in morning trading Thursday after the asset management company announced it would split into three companies.

The company said it would spin off two business development companies called American Capital Growth and Income and American Capital Income.

American Capital will continue to focus mostly on asset management. Most of American Capital Growth and Income's assets will come from securities issued by operating companies bought by American Capital One Stop Buyouts, senior floating rate loans to private companies, and CLO equity investments. Most of American Capital Income's assets will come from second lien and mezzanine loans to middle market companies.

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American Capital also announced third-quarter earnings after the market close Wednesday that beat analysts' expectations. The company reported earnings of 18 cents a share, while revenue grew 21.7% year-over-year to $129 million.

Analysts had expected EPS of 16 cents on revenue of $119.1 million.

Separately, TheStreet Ratings team rates AMERICAN CAPITAL LTD as a "hold" with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:

TheStreet Recommends

"We rate AMERICAN CAPITAL LTD (ACAS) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and relatively poor performance when compared with the S&P 500 during the past year."

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