Ares Capital (ARCC) Laps the Stock Market: Here's Why
In the latest market close, Ares Capital (ARCC) reached $20.39, with a +0.79% movement compared to the previous day. The stock outperformed the S&P 500, which registered a daily gain of 0.51%. Elsewhere, the Dow gained 0.2%, while the tech-heavy Nasdaq added 0.58%.
The private equity firm's stock has climbed by 1.45% in the past month, falling short of the Finance sector's gain of 4.57% and the S&P 500's gain of 2.94%.
The investment community will be closely monitoring the performance of Ares Capital in its forthcoming earnings report. The company is forecasted to report an EPS of $0.58, showcasing a 3.57% upward movement from the corresponding quarter of the prior year. Meanwhile, our latest consensus estimate is calling for revenue of $700.81 million, up 13.4% from the prior-year quarter.
ARCC's full-year Zacks Consensus Estimates are calling for earnings of $2.32 per share and revenue of $2.84 billion. These results would represent year-over-year changes of -2.11% and +8.59%, respectively.
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. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 0.05% fall in the Zacks Consensus EPS estimate. Ares Capital presently features a Zacks Rank of #3 (Hold).
Looking at its valuation, Ares Capital is holding a Forward P/E ratio of 8.72. This valuation marks a premium compared to its industry's average Forward P/E of 7.59.
The Financial - SBIC & Commercial Industry industry is part of the Finance sector. This group has a Zacks Industry Rank of 180, putting it in the bottom 29% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Ares Capital Corporation (ARCC) : Free Stock Analysis Report
