Ares Capital (ARCC) Rises Higher Than Market: Key Facts

Ares Capital (ARCC) closed the most recent trading day at $23.06, moving +1.36% from the previous trading session. The stock outperformed the S&P 500, which registered a daily gain of 0.32%. Elsewhere, the Dow gained 0.53%, while the tech-heavy Nasdaq added 0.26%.

Shares of the private equity firm witnessed a gain of 6.71% over the previous month, beating the performance of the Finance sector with its gain of 3.04%, and the S&P 500's gain of 4.51%.

The investment community will be closely monitoring the performance of Ares Capital in its forthcoming earnings report. The company is scheduled to release its earnings on July 29, 2025. The company's upcoming EPS is projected at $0.51, signifying a 16.39% drop compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $746.71 million, reflecting a 1.1% fall from the equivalent quarter last year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $2.02 per share and revenue of $2.99 billion, which would represent changes of -13.3% and -0.09%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Ares Capital. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.42% lower. Right now, Ares Capital possesses a Zacks Rank of #4 (Sell).

Investors should also note Ares Capital's current valuation metrics, including its Forward P/E ratio of 11.25. This signifies a premium in comparison to the average Forward P/E of 8.89 for its industry.

The Financial - SBIC & Commercial Industry industry is part of the Finance sector. Currently, this industry holds a Zacks Industry Rank of 191, positioning it in the bottom 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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