What Analysts Are Saying About Ares Capital Stock

Ares Capital ARCC has been analyzed by 7 analysts in the last three months, revealing a diverse range of perspectives from bullish to bearish.

The table below provides a concise overview of recent ratings by analysts, offering insights into the changing sentiments over the past 30 days and drawing comparisons with the preceding months for a holistic perspective.

Analysts' evaluations of 12-month price targets offer additional insights, showcasing an average target of $21.86, with a high estimate of $23.00 and a low estimate of $21.00. Observing a downward trend, the current average is 4.08% lower than the prior average price target of $22.79.

Decoding Analyst Ratings: A Detailed Look

The analysis of recent analyst actions sheds light on the perception of Ares Capital by financial experts. The following summary presents key analysts, their recent evaluations, and adjustments to ratings and price targets.

Key Insights:

• Action Taken: Analysts adapt their recommendations to changing market conditions and company performance. Whether they 'Maintain', 'Raise' or 'Lower' their stance, it reflects their response to recent developments related to Ares Capital. This information provides a snapshot of how analysts perceive the current state of the company.
• Rating: Delving into assessments, analysts assign qualitative values, from 'Outperform' to 'Underperform'. These ratings communicate expectations for the relative performance of Ares Capital compared to the broader market.
• Price Targets: Analysts gauge the dynamics of price targets, providing estimates for the future value of Ares Capital's stock. This comparison reveals trends in analysts' expectations over time.

Considering these analyst evaluations in conjunction with other financial indicators can offer a comprehensive understanding of Ares Capital's market position. Stay informed and make well-informed decisions with our Ratings Table.

Stay up to date on Ares Capital analyst ratings.

Unveiling the Story Behind Ares Capital

Ares Capital Corp is a United States-based closed-ended specialty finance company. Its investment objective is to generate both current income and capital appreciation through debt and equity investments. The company focuses on investing primarily in first lien senior secured loans (including unitranche loans, which are loans that combine both senior and subordinated debt, generally in a first lien position) and second lien senior secured loans. In addition to senior secured loans, the company also invests in subordinated loans and preferred equity, it also makes common equity investments.

Breaking Down Ares Capital's Financial Performance

Market Capitalization Analysis: Below industry benchmarks, the company's market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

Decline in Revenue: Over the 3M period, Ares Capital faced challenges, resulting in a decline of approximately -44.65% in revenue growth as of 31 March, 2025. This signifies a reduction in the company's top-line earnings. When compared to others in the Financials sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Net Margin: Ares Capital's net margin is impressive, surpassing industry averages. With a net margin of 87.96%, the company demonstrates strong profitability and effective cost management.

Return on Equity (ROE): Ares Capital's ROE is below industry standards, pointing towards difficulties in efficiently utilizing equity capital. With an ROE of 1.78%, the company may encounter challenges in delivering satisfactory returns for shareholders.

Return on Assets (ROA): The company's ROA is below industry benchmarks, signaling potential difficulties in efficiently utilizing assets. With an ROA of 0.85%, the company may need to address challenges in generating satisfactory returns from its assets.

Debt Management: Ares Capital's debt-to-equity ratio is below the industry average. With a ratio of 1.02, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

Analyst Ratings: Simplified

Analyst ratings serve as essential indicators of stock performance, provided by experts in banking and financial systems. These specialists diligently analyze company financial statements, participate in conference calls, and engage with insiders to generate quarterly ratings for individual stocks.

Some analysts will also offer forecasts for metrics like growth estimates, earnings, and revenue to provide further guidance on stocks. Investors who use analyst ratings should note that this specialized advice comes from humans and may be subject to error.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.