ARES CAPITAL CORP (ARCC) Fundamental Analysis & Valuation

NASDAQ:ARCC • US04010L1035

Current stock price

18.19 USD
+0.1 (+0.55%)
At close:
18.23 USD
+0.04 (+0.22%)
After Hours:

This ARCC fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

4

1. ARCC Profitability Analysis

1.1 Basic Checks

  • In the past year ARCC was profitable.
  • In the past year ARCC has reported a negative cash flow from operations.
  • Each year in the past 5 years ARCC has been profitable.
  • ARCC had negative operating cash flow in 4 of the past 5 years.
ARCC Yearly Net Income VS EBIT VS OCF VS FCFARCC Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B -1B -2B

1.2 Ratios

  • ARCC's Return On Assets of 4.16% is fine compared to the rest of the industry. ARCC outperforms 65.00% of its industry peers.
  • With a Return On Equity value of 9.07%, ARCC perfoms like the industry average, outperforming 56.67% of the companies in the same industry.
  • With a Return On Invested Capital value of 3.78%, ARCC perfoms like the industry average, outperforming 54.58% of the companies in the same industry.
  • ARCC had an Average Return On Invested Capital over the past 3 years of 4.16%. This is below the industry average of 7.19%.
Industry RankSector Rank
ROA 4.16%
ROE 9.07%
ROIC 3.78%
ROA(3y)5.31%
ROA(5y)5.23%
ROE(3y)11.35%
ROE(5y)11.6%
ROIC(3y)4.16%
ROIC(5y)3.93%
ARCC Yearly ROA, ROE, ROICARCC Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5 10 15

1.3 Margins

  • ARCC has a better Profit Margin (42.56%) than 87.50% of its industry peers.
  • ARCC's Profit Margin has improved in the last couple of years.
  • With an excellent Operating Margin value of 47.77%, ARCC belongs to the best of the industry, outperforming 85.42% of the companies in the same industry.
  • ARCC's Operating Margin has declined in the last couple of years.
  • ARCC has a Gross Margin (49.44%) which is in line with its industry peers.
  • ARCC's Gross Margin has declined in the last couple of years.
Industry RankSector Rank
OM 47.77%
PM (TTM) 42.56%
GM 49.44%
OM growth 3Y-4.43%
OM growth 5Y-2.35%
PM growth 3Y14.14%
PM growth 5Y5.85%
GM growth 3Y-4.37%
GM growth 5Y-2.57%
ARCC Yearly Profit, Operating, Gross MarginsARCC Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20 40 60 80

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ROAROEROICOperating and Profit MarginShow most profitable peers

2

2. ARCC Health Analysis

2.1 Basic Checks

  • ARCC has more shares outstanding than it did 1 year ago.
  • Compared to 5 years ago, ARCC has more shares outstanding
  • The debt/assets ratio for ARCC is higher compared to a year ago.
ARCC Yearly Shares OutstandingARCC Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M
ARCC Yearly Total Debt VS Total AssetsARCC Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B

2.2 Solvency

  • Based on the Altman-Z score of 0.77, we must say that ARCC is in the distress zone and has some risk of bankruptcy.
  • Looking at the Altman-Z score, with a value of 0.77, ARCC is in line with its industry, outperforming 52.92% of the companies in the same industry.
  • ARCC has a Debt/Equity ratio of 1.12. This is a high value indicating a heavy dependency on external financing.
  • With a Debt to Equity ratio value of 1.12, ARCC perfoms like the industry average, outperforming 45.00% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 1.12
Debt/FCF N/A
Altman-Z 0.77
ROIC/WACCN/A
WACCN/A
ARCC Yearly LT Debt VS Equity VS FCFARCC Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 5B 10B 15B

2.3 Liquidity

  • A Current Ratio of 1.67 indicates that ARCC should not have too much problems paying its short term obligations.
  • With a decent Current ratio value of 1.67, ARCC is doing good in the industry, outperforming 70.42% of the companies in the same industry.
  • A Quick Ratio of 1.67 indicates that ARCC should not have too much problems paying its short term obligations.
  • ARCC has a Quick ratio of 1.67. This is in the better half of the industry: ARCC outperforms 70.42% of its industry peers.
Industry RankSector Rank
Current Ratio 1.67
Quick Ratio 1.67
ARCC Yearly Current Assets VS Current LiabilitesARCC Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M 800M 1B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

2

3. ARCC Growth Analysis

3.1 Past

  • ARCC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -18.03%.
  • ARCC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.00% yearly.
  • Looking at the last year, ARCC shows a small growth in Revenue. The Revenue has grown by 2.07% in the last year.
  • The Revenue has been growing by 15.10% on average over the past years. This is quite good.
EPS 1Y (TTM)-18.03%
EPS 3Y-1.69%
EPS 5Y2%
EPS Q2Q%-25.45%
Revenue 1Y (TTM)2.07%
Revenue growth 3Y13.34%
Revenue growth 5Y15.1%
Sales Q2Q%-5.8%

3.2 Future

  • Based on estimates for the next years, ARCC will show a decrease in Earnings Per Share. The EPS will decrease by -0.31% on average per year.
  • The Revenue is expected to decrease by -3.21% on average over the next years.
EPS Next Y2.89%
EPS Next 2Y1.42%
EPS Next 3Y-0.31%
EPS Next 5YN/A
Revenue Next Year3.53%
Revenue Next 2Y2.91%
Revenue Next 3Y-3.21%
Revenue Next 5YN/A

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
  • The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
ARCC Yearly Revenue VS EstimatesARCC Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 1B 2B 3B
ARCC Yearly EPS VS EstimatesARCC Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 0.5 1 1.5 2

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4

4. ARCC Valuation Analysis

4.1 Price/Earnings Ratio

  • ARCC is valuated reasonably with a Price/Earnings ratio of 9.52.
  • Based on the Price/Earnings ratio, ARCC is valued a bit cheaper than the industry average as 67.92% of the companies are valued more expensively.
  • When comparing the Price/Earnings ratio of ARCC to the average of the S&P500 Index (27.18), we can say ARCC is valued rather cheaply.
  • The Price/Forward Earnings ratio is 9.26, which indicates a very decent valuation of ARCC.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of ARCC indicates a somewhat cheap valuation: ARCC is cheaper than 71.25% of the companies listed in the same industry.
  • ARCC is valuated cheaply when we compare the Price/Forward Earnings ratio to 37.96, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 9.52
Fwd PE 9.26
ARCC Price Earnings VS Forward Price EarningsARCC Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

Industry RankSector Rank
P/FCF N/A
EV/EBITDA N/A
ARCC Per share dataARCC EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 10 15

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)3.29
PEG (5Y)4.76
EPS Next 2Y1.42%
EPS Next 3Y-0.31%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

6

5. ARCC Dividend Analysis

5.1 Amount

  • ARCC has a Yearly Dividend Yield of 10.66%, which is a nice return.
  • Compared to an average industry Dividend Yield of 6.65, ARCC pays a bit more dividend than its industry peers.
  • Compared to an average S&P500 Dividend Yield of 1.82, ARCC pays a better dividend.
Industry RankSector Rank
Dividend Yield 10.66%

5.2 History

  • The dividend of ARCC has a limited annual growth rate of 2.72%.
  • ARCC has paid a dividend for at least 10 years, which is a reliable track record.
  • ARCC has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)2.72%
Div Incr Years0
Div Non Decr Years5
ARCC Yearly Dividends per shareARCC Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0.5 1 1.5

5.3 Sustainability

  • 97.31% of the earnings are spent on dividend by ARCC. This is not a sustainable payout ratio.
  • The Dividend Rate of ARCC has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP97.31%
EPS Next 2Y1.42%
EPS Next 3Y-0.31%
ARCC Yearly Income VS Free CF VS DividendARCC Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 1B -1B -2B
ARCC Dividend Payout.ARCC Dividend Payout, showing the Payout Ratio.ARCC Dividend Payout.PayoutRetained Earnings

More info and screens

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ARCC Fundamentals: All Metrics, Ratios and Statistics

ARES CAPITAL CORP

NASDAQ:ARCC (4/13/2026, 8:09:04 PM)

After market: 18.23 +0.04 (+0.22%)

18.19

+0.1 (+0.55%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)02-04
Earnings (Next)04-28
Inst Owners34.35%
Inst Owner Change0.5%
Ins Owners0.5%
Ins Owner Change1.47%
Market Cap13.06B
Revenue(TTM)3.05B
Net Income(TTM)1.30B
Analysts83
Price Target22.57 (24.08%)
Short Float %5.67%
Short Ratio4.93
Dividend
Industry RankSector Rank
Dividend Yield 10.66%
Yearly Dividend1.82
Dividend Growth(5Y)2.72%
DP97.31%
Div Incr Years0
Div Non Decr Years5
Ex-Date03-13
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-10.83%
Min EPS beat(2)-19.28%
Max EPS beat(2)-2.38%
EPS beat(4)0
Avg EPS beat(4)-8.42%
Min EPS beat(4)-19.28%
Max EPS beat(4)-2.38%
EPS beat(8)1
Avg EPS beat(8)-5.61%
EPS beat(12)3
Avg EPS beat(12)-3.92%
EPS beat(16)5
Avg EPS beat(16)-2.95%
Revenue beat(2)1
Avg Revenue beat(2)2.78%
Min Revenue beat(2)-11.79%
Max Revenue beat(2)17.35%
Revenue beat(4)1
Avg Revenue beat(4)-1.29%
Min Revenue beat(4)-11.79%
Max Revenue beat(4)17.35%
Revenue beat(8)2
Avg Revenue beat(8)-1.33%
Revenue beat(12)3
Avg Revenue beat(12)-0.35%
Revenue beat(16)6
Avg Revenue beat(16)-0.14%
PT rev (1m)-0.65%
PT rev (3m)-2.29%
EPS NQ rev (1m)-0.48%
EPS NQ rev (3m)-1.63%
EPS NY rev (1m)-0.58%
EPS NY rev (3m)-1.2%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.02%
Revenue NY rev (1m)-0.59%
Revenue NY rev (3m)-1.56%
Valuation
Industry RankSector Rank
PE 9.52
Fwd PE 9.26
P/S 4.28
P/FCF N/A
P/OCF N/A
P/B 0.91
P/tB 0.91
EV/EBITDA N/A
EPS(TTM)1.91
EY10.5%
EPS(NY)1.97
Fwd EY10.8%
FCF(TTM)-2.39
FCFYN/A
OCF(TTM)-2.39
OCFYN/A
SpS4.25
BVpS19.94
TBVpS19.94
PEG (NY)3.29
PEG (5Y)4.76
Graham Number29.27
Profitability
Industry RankSector Rank
ROA 4.16%
ROE 9.07%
ROCE 4.78%
ROIC 3.78%
ROICexc 3.86%
ROICexgc 3.89%
OM 47.77%
PM (TTM) 42.56%
GM 49.44%
FCFM N/A
ROA(3y)5.31%
ROA(5y)5.23%
ROE(3y)11.35%
ROE(5y)11.6%
ROIC(3y)4.16%
ROIC(5y)3.93%
ROICexc(3y)4.25%
ROICexc(5y)4.01%
ROICexgc(3y)4.28%
ROICexgc(5y)4.04%
ROCE(3y)5.26%
ROCE(5y)4.98%
ROICexgc growth 3Y-2.72%
ROICexgc growth 5Y-1.5%
ROICexc growth 3Y-2.84%
ROICexc growth 5Y-1.53%
OM growth 3Y-4.43%
OM growth 5Y-2.35%
PM growth 3Y14.14%
PM growth 5Y5.85%
GM growth 3Y-4.37%
GM growth 5Y-2.57%
F-Score2
Asset Turnover0.1
Health
Industry RankSector Rank
Debt/Equity 1.12
Debt/FCF N/A
Debt/EBITDA N/A
Cap/Depr N/A
Cap/Sales N/A
Interest Coverage 1.94
Cash Conversion N/A
Profit Quality N/A
Current Ratio 1.67
Quick Ratio 1.67
Altman-Z 0.77
F-Score2
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-18.03%
EPS 3Y-1.69%
EPS 5Y2%
EPS Q2Q%-25.45%
EPS Next Y2.89%
EPS Next 2Y1.42%
EPS Next 3Y-0.31%
EPS Next 5YN/A
Revenue 1Y (TTM)2.07%
Revenue growth 3Y13.34%
Revenue growth 5Y15.1%
Sales Q2Q%-5.8%
Revenue Next Year3.53%
Revenue Next 2Y2.91%
Revenue Next 3Y-3.21%
Revenue Next 5YN/A
EBIT growth 1Y-1.22%
EBIT growth 3Y8.33%
EBIT growth 5Y12.39%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y19.31%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y19.31%
OCF growth 3YN/A
OCF growth 5YN/A

ARES CAPITAL CORP / ARCC Fundamental Analysis FAQ

What is the fundamental rating for ARCC stock?

ChartMill assigns a fundamental rating of 3 / 10 to ARCC.


What is the valuation status for ARCC stock?

ChartMill assigns a valuation rating of 4 / 10 to ARES CAPITAL CORP (ARCC). This can be considered as Fairly Valued.


What is the profitability of ARCC stock?

ARES CAPITAL CORP (ARCC) has a profitability rating of 4 / 10.


What is the expected EPS growth for ARES CAPITAL CORP (ARCC) stock?

The Earnings per Share (EPS) of ARES CAPITAL CORP (ARCC) is expected to grow by 2.89% in the next year.


Can you provide the dividend sustainability for ARCC stock?

The dividend rating of ARES CAPITAL CORP (ARCC) is 6 / 10 and the dividend payout ratio is 97.31%.