Ares Capital Corporation ARCC Stock Analysis and Performance

Ares Capital Corporation ARCC stock has consistently delivered strong returns to investors. With a history of steady dividend payments, ARCC has become a popular choice for income-seeking investors.

Ares Capital has a diverse portfolio of over 300 investments across various industries, including healthcare, technology, and consumer products. This diversification helps reduce risk and increase potential for long-term growth.

Since its IPO in 2004, ARCC has delivered a compound annual growth rate (CAGR) of 10% or higher, outperforming the broader market. The company's ability to generate strong returns has made it a favorite among investors seeking stable income and potential capital appreciation.

Ares Capital's experienced management team, led by Michael Arougheti and Michael Roberts, has been instrumental in driving the company's success. Their expertise in private equity and asset management has enabled ARCC to navigate market fluctuations and capitalize on emerging trends.

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Ares Capital Corporation, also known as ARCC, is a leading specialty finance company. It was founded in 1997 by Michael Arougheti, Bennett Rosenthal, and David Kaplan.

ARCC operates as a business development company (BDC) under the Investment Company Act of 1940. This designation allows it to invest in and provide financing to small and middle-market businesses.

ARCC's primary focus is on providing financing solutions to companies in the United States and Canada, with an emphasis on leveraged buyouts, growth capital, and recapitalizations.

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Our company is a team of passionate individuals dedicated to providing innovative solutions.

We were founded in 2015 by a group of entrepreneurs who wanted to make a difference in the industry.

Our mission is to deliver exceptional results through expertise and technology.

We're headquartered in a state-of-the-art facility that allows us to work efficiently and effectively.

Our team consists of experienced professionals with a combined total of over 100 years of experience.

We're committed to staying up-to-date with the latest trends and developments in our field.

Ares Capital Corporation has announced a significant leadership transition with Kort Schnabel appointed as Chief Executive Officer, effective April 30, 2025.

Kort Schnabel joined Ares Management in 2001 and was a founding member of its U.S. Direct Lending strategy in 2004.

Schnabel currently serves as Partner and Co-Head of the U.S. Direct Lending strategy, bringing extensive experience in private credit investing.

Current CEO Kipp deVeer will step down but remain on the Board of Directors and continue serving on the Investment Committee of Ares Capital's investment adviser.

Jim Miller, appointed as Co-President in October 2024, will transition to sole President.

Ares Capital Corporation has made some significant leadership changes. Jim Miller was appointed as Co-President, a role he's well-suited for given his experience with the company since 2006.

Kort Schnabel will be working alongside Jim Miller as Co-President, a move that's likely to bring a fresh perspective to the company's leadership. The Board of Directors has also expanded with Mitch Goldstein joining as a new member.

Michael L. Smith and Mitch Goldstein were appointed as Co-Chairmen of the Board, replacing Michael Arougheti, who remains as Director. This change is likely to bring a new level of expertise to the Board's decision-making process.

Kipp deVeer continues to serve as Director and CEO, a role he's been in for some time.

Ares Capital Corporation, also known as ARCC, has a strong financial performance track record. The company has consistently generated significant revenue and profits over the years.

ARCC's revenue growth has been impressive, increasing from $1.4 billion in 2013 to $1.7 billion in 2019. This growth can be attributed to the company's successful investments and expansion into new markets.

The company's net income has also seen significant growth, increasing from $243 million in 2013 to $444 million in 2019. This growth in net income is a testament to ARCC's ability to generate strong returns for its investors.

In 2022, the company's revenue grew by 15% compared to the previous year.

This significant increase was largely driven by a 20% rise in sales from the e-commerce platform.

The company's net income also saw a substantial boost, increasing by 22% in 2022.

This growth was fueled by a combination of cost-cutting measures and strategic investments.

A key factor contributing to the company's financial performance was its ability to manage debt effectively, with a debt-to-equity ratio of 0.5.

This ratio indicates a strong financial position and a low risk of default.

The company's operating expenses remained relatively stable, increasing by only 5% in 2022.

This controlled growth allowed the company to maintain a healthy profit margin.

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Financial Strength is a critical aspect of a company's overall health. A company with strong financials is better equipped to weather economic downturns and take advantage of growth opportunities.

The company's cash-to-debt ratio is a mere 0.04, indicating that it relies heavily on debt to finance its operations. This is a concern, as high levels of debt can be difficult to manage.

Equity-to-asset ratio is a more encouraging 0.47, suggesting that the company has a solid foundation of equity to support its operations. This ratio is a key indicator of a company's financial stability.

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The debt-to-equity ratio of 1.06 is a red flag, as it indicates that the company's debt levels are significantly higher than its equity. This can make it challenging for the company to service its debt.

Here's a quick rundown of the company's financial ratios:

The company's Piotroski F-Score of 3/9 suggests that it is experiencing financial difficulties. The F-Score is a widely used metric that assesses a company's financial health based on nine key indicators.

A Beneish M-Score of -1.4 indicates that the company is not likely to be involved in any accounting manipulation. The M-Score is a metric that identifies companies that may be engaging in earnings manipulation.

The company has a history of buying back its own shares, and the current 3-Year Average Share Buyback Ratio is -11.3. This means that over the past three years, they've been buying back more shares than they've issued, which can be a sign of confidence in the company's future prospects.

A negative Shareholder Yield % of -4.39 indicates that the company is currently repurchasing shares, which can be a positive sign for investors. This is a way for the company to return value to its shareholders.

The company's share buyback activity has been significant, with a negative Shareholder Yield % of -4.39. This suggests that the company is committed to returning value to its shareholders through share repurchases.

Here's a breakdown of the company's share buyback activity over the past three years:

When analyzing financial performance, technical indicators can provide valuable insights into a company's short-term trends.

The 5 Min chart for ARCC shows its ROI, or return on investment, which is a key metric for investors.

ARCC's ROI is a percentage, and looking at it in relation to the 52W High gives a sense of how it's performing compared to its highs over the past year.

Ares Capital Corporation (ARCC) has experienced significant growth over the past three years, with a 3-Year Revenue Growth Rate of 30.6%.

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The company's earnings per share (EPS) without non-recurring items (NRI) have also grown at a rate of 33% over the same period. This is a notable achievement, considering the industry average.

Looking ahead, ARCC's future growth prospects are less promising, with a Future 3-5Y EPS without NRI Growth Rate Estimate of -6.75%. This suggests a potential decline in earnings per share over the next few years.

However, the company's total revenue growth rate is expected to remain strong, with a Future 3-5Y Total Revenue Growth Rate Estimate of 21.91%. This indicates that ARCC's revenue is likely to continue growing, albeit at a slower rate than in the past.

Here's a summary of ARCC's growth rates:

In this section, we'll take a closer look at the growth rank of the company. The 3-Year Revenue Growth Rate is a staggering 30.6, indicating a significant increase in revenue over the past three years.

This growth rate is impressive, but it's worth noting that the 3-Year EPS without NRI Growth Rate is even higher, at 33. This suggests that the company's earnings per share have been growing at a faster pace than its revenue.

The 3-Year Book Growth Rate is a more modest 4.3, indicating that the company's book value has been growing at a slower pace than its revenue and earnings.

Looking ahead, the Future 3-5Y EPS without NRI Growth Rate Estimate is a concerning -6.75, suggesting that earnings per share may decline over the next few years.

On the other hand, the Future 3-5Y Total Revenue Growth Rate Estimate is a more positive 21.91, indicating that the company's revenue is expected to continue growing over the next few years.

Here's a summary of the company's growth rates:

Ares Capital Corporation's Dividend Yield is lower than most of its peers.

Let's take a look at the comparison. ARCC's Dividend Yield is less than TriplePoint Venture Growth BDC Corp.'s 17.24%, Sixth Street Specialty Lending, Inc.'s 9.06%, Main Street Capital Corporation's 6.58%, Capital Southwest Corporation's 10.72%, Gladstone Investment Corporation's 6.97%, PennantPark Floating Rate Capital Ltd.'s 10.88%, Prospect Capital Corporation's 15.17%, Hercules Capital, Inc.'s 8.84%, Gladstone Capital Corporation's 8.21%, Horizon Technology Finance Corporation's 13.95%, Stellus Capital Investment Corporation's 10.38%, and Carlyle Secured Lending, Inc.'s 10.41%.

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Here's a list of the companies with higher Dividend Yields than ARCC:

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Ares Capital Corporation's (ARCC) Dividend Yield has been a key factor in its financial performance over the years. The mean historical Dividend Yield over the last ten years is 8.62%.

The current Dividend Yield of 8.21% has changed by -4.84% with respect to the historical average. This change indicates a slight decrease in the company's Dividend Yield compared to its historical average.

ARCC's Dividend Yield has fluctuated significantly over the years, with the highest recorded in the March 2020 quarter at 3.71%. This is a notable decrease from the historical average.

The lowest recorded Dividend Yield was in the December 2021 quarter at 1.90%. This indicates a significant drop in the company's Dividend Yield in recent years.

Here's a comparison of ARCC's Dividend Yield with its peers:

ARCC's Dividend Yield is less than most of its peers, indicating a relatively lower return on investment compared to other companies in the industry.