Ares Capital
Market Cap
US$8.0b
Last Updated
2021/02/26 23:52 UTC
Data Sources
Company Financials +
Executive Summary
Ares Capital Corporation is a business development company specializing in acquisition, recapitalization, mezzanine debt, restructurings, rescue financing, and leveraged buyout transactions of middle market companies. More Details
Rewards
Snowflake Analysis
Similar Companies
Share Price & News
How has Ares Capital's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: ARCC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.
Volatility Over Time: ARCC's weekly volatility has decreased from 9% to 3% over the past year.
Market Performance
7 Day Return
2.1%
ARCC
-2.6%
US Capital Markets
-4.6%
US Market
1 Year Return
6.6%
ARCC
38.0%
US Capital Markets
38.5%
US Market
Return vs Industry: ARCC underperformed the US Capital Markets industry which returned 36.4% over the past year.
Return vs Market: ARCC underperformed the US Market which returned 38.9% over the past year.
Shareholder returns
| ARCC | Industry | Market | |
|---|---|---|---|
| 7 Day | 2.1% | -2.6% | -4.6% |
| 30 Day | 4.9% | 8.5% | 0.6% |
| 90 Day | 8.9% | 14.9% | 1.9% |
| 1 Year | 18.8%6.6% | 41.3%38.0% | 41.5%38.5% |
| 3 Year | 56.5%16.7% | 39.5%29.1% | 56.7%46.7% |
| 5 Year | 110.1%29.2% | 140.6%110.9% | 123.5%98.6% |
Long-Term Price Volatility Vs. Market
How volatile is Ares Capital's share price compared to the market and industry in the last 5 years?
Simply Wall St News
3 years ago | Simply Wall St
Read This Before Buying Ares Capital Corporation (ARCC) For Its Upcoming $0.38 Dividend3 years ago | Simply Wall St
What Do Analysts Think About Ares Capital Corporation's (ARCC) Future?3 years ago | Simply Wall St
Ares Capital Corporation (ARCC): What Does The Future Look Like?Valuation
Is Ares Capital undervalued compared to its fair value and its price relative to the market?
19.8%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: ARCC ($18.33) is trading below our estimate of fair value ($22.86)
Significantly Below Fair Value: ARCC is trading below fair value, but not by a significant amount.
Price To Earnings Ratio
PE vs Industry: ARCC is good value based on its PE Ratio (16.1x) compared to the US Capital Markets industry average (23.4x).
PE vs Market: ARCC is good value based on its PE Ratio (16.1x) compared to the US market (21.2x).
Price to Earnings Growth Ratio
PEG Ratio: ARCC is good value based on its PEG Ratio (0.8x)
Price to Book Ratio
PB vs Industry: ARCC is good value based on its PB Ratio (1.1x) compared to the US Capital Markets industry average (10.9x).
Future Growth
How is Ares Capital forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?
19.7%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: ARCC's forecast earnings growth (19.7% per year) is above the savings rate (2%).
Earnings vs Market: ARCC's earnings (19.7% per year) are forecast to grow slower than the US market (20.2% per year).
High Growth Earnings: ARCC's earnings are forecast to grow, but not significantly.
Revenue vs Market: ARCC's revenue (3.9% per year) is forecast to grow slower than the US market (10.4% per year).
High Growth Revenue: ARCC's revenue (3.9% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: ARCC's Return on Equity is forecast to be low in 3 years time (10.4%).
Past Performance
How has Ares Capital performed over the past 5 years?
-0.01%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: ARCC has a large one-off loss of $292.0M impacting its December 31 2020 financial results.
Growing Profit Margin: ARCC's current net profit margins (32%) are lower than last year (51.3%).
Past Earnings Growth Analysis
Earnings Trend: ARCC's earnings have declined by 0.01% per year over the past 5 years.
Accelerating Growth: ARCC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: ARCC had negative earnings growth (-38.3%) over the past year, making it difficult to compare to the Capital Markets industry average (9.9%).
Return on Equity
High ROE: ARCC's Return on Equity (6.7%) is considered low.
Financial Health
How is Ares Capital's financial position?
Financial Position Analysis
Short Term Liabilities: ARCC's short term assets ($549.0M) exceed its short term liabilities ($414.0M).
Long Term Liabilities: ARCC's short term assets ($549.0M) do not cover its long term liabilities ($8.6B).
Debt to Equity History and Analysis
Debt Level: ARCC's debt to equity ratio (119.4%) is considered high.
Reducing Debt: ARCC's debt to equity ratio has increased from 79.5% to 119.4% over the past 5 years.
Debt Coverage: ARCC's operating cash flow is negative, therefore debt is not well covered.
Interest Coverage: ARCC's interest payments on its debt are well covered by EBIT (3.7x coverage).
Balance Sheet
Dividend
What is Ares Capital current dividend yield, its reliability and sustainability?
8.73%
Current Dividend Yield
Upcoming Dividend Payment
Dividend Yield vs Market
Notable Dividend: ARCC's dividend (8.73%) is higher than the bottom 25% of dividend payers in the US market (1.35%).
High Dividend: ARCC's dividend (8.73%) is in the top 25% of dividend payers in the US market (3.72%)
Stability and Growth of Payments
Stable Dividend: ARCC's dividends per share have been stable in the past 10 years.
Growing Dividend: ARCC's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its high payout ratio (140.2%), ARCC's dividend payments are not well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: ARCC's dividends in 3 years are forecast to be covered by earnings (88.8% payout ratio).
Management
How experienced are the management team and are they aligned to shareholders interests?
6.6yrs
Average management tenure
CEO
Robert DeVeer (47 yo)
6.58yrs
Tenure
Mr. Robert Kipp DeVeer, III, serves as Director of Ares Management Corporation since February 13, 2020. Mr. DeVeer is Director at Ares Capital Corporation since 2015 and has also been its Chief Executive O...
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| Co-Chairman & Executive VP | 6.58yrs | no data | 0.30% $ 24.0m | |
| Co-Founder & Co-Chairman | 17.08yrs | no data | no data | |
| CEO & Director | 6.58yrs | no data | 0.069% $ 5.5m | |
| Co-President | 6.58yrs | no data | 0.063% $ 5.1m | |
| Co-President | 6.58yrs | no data | 0.043% $ 3.4m | |
| Chief Financial Officer | 10.17yrs | no data | 0.015% $ 1.2m | |
| Chief Accounting Officer | 7.17yrs | no data | no data | |
| Managing Director of IR | no data | no data | no data | |
| VP, General Counsel & Secretary | 11.08yrs | no data | 0.0038% $ 302.3k | |
| Chief Compliance Officer | 1.83yrs | no data | no data | |
| Partner/Head of Public Investor Relations & Communications | no data | no data | no data | |
| 12.58yrs | no data | no data |
6.6yrs
Average Tenure
48yo
Average Age
Experienced Management: ARCC's management team is seasoned and experienced (6.6 years average tenure).
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| Co-Chairman & Executive VP | 6.58yrs | no data | 0.30% $ 24.0m | |
| Co-Founder & Co-Chairman | 17.08yrs | no data | no data | |
| CEO & Director | 6.58yrs | no data | 0.069% $ 5.5m | |
| Director | 17.08yrs | no data | 0.011% $ 879.8k | |
| Independent Director | 1.25yrs | US$52.50k | 0.0049% $ 388.7k | |
| Lead Independent Director | 10.5yrs | US$294.50k | 0.012% $ 971.0k | |
| Independent Director | 4.75yrs | US$253.50k | 0.0078% $ 621.5k | |
| Independent Director | 8.33yrs | US$249.50k | 0.0063% $ 499.9k | |
| Independent Director | 10.83yrs | US$278.50k | 0.0073% $ 586.3k | |
| Independent Director | 8.42yrs | US$260.50k | 0.0079% $ 628.7k |
8.4yrs
Average Tenure
61yo
Average Age
Experienced Board: ARCC's board of directors are considered experienced (8.4 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Ares Capital Corporation's company bio, employee growth, exchange listings and data sources
Key Information
- Name: Ares Capital Corporation
- Ticker: ARCC
- Exchange: NasdaqGS
- Founded: 2004
- Industry: Asset Management and Custody Banks
- Sector: Diversified Financials
- Market Cap: US$7.998b
- Shares outstanding: 436.35m
- Website: https://www.arescapitalcorp.com
Location
- Ares Capital Corporation
- 245 Park Avenue
- 44th Floor
- New York
- New York
- 10167
- United States
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| ARCC | NasdaqGS (Nasdaq Global Select) | Yes | Common Stock | US | USD | Oct 2004 |
| 9A2 | DB (Deutsche Boerse AG) | Yes | Common Stock | DE | EUR | Oct 2004 |
| 0HHP | LSE (London Stock Exchange) | Yes | Common Stock | GB | USD | Oct 2004 |
Biography
Ares Capital Corporation is a business development company specializing in acquisition, recapitalization, mezzanine debt, restructurings, rescue financing, and leveraged buyout transactions of middle marke...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/02/26 23:52 |
| End of Day Share Price | 2021/02/26 00:00 |
| Earnings | 2020/12/31 |
| Annual Earnings | 2020/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.