We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
What's in the Cards for Ares Capital (ARCC) in Q4 Earnings?
Read MoreHide Full Article
Ares Capital Corporation (ARCC - Free Report) is scheduled to announce fourth quarter and 2018 results on Feb 12, before the market opens. Its quarterly revenues and earnings are projected to grow year over year.
In the last reported quarter, the company’s bottom line surpassed the Zacks Consensus Estimate. Results benefited from an increase in total investment income and healthy portfolio activity, partly offset by higher expenses.
The company has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, the average beat being 5.2%.
Activities of the company in the fourth quarter were adequate to win analysts’ confidence. As a result, the consensus estimate for earnings of 41 cents moved 2.5% upward over the past 30 days. Also, it reflects a year-over-year improvement of 7.9%.
Further, the Zacks Consensus Estimate for sales of $327.2 million reflects growth of 6.6% on a year-over-year basis.
Before we take a look at what our quantitative model predicts for the to-be-reported quarter, let’s check the factors that are likely to impact the results.
Factors to Impact Q4 Results
Given the expectation of higher prepayment activity during the fourth quarter, total investment income is likely to be positively impacted. Also, with the recent increase in LIBOR rates, Ares Capital’s floating-rate debt investments that are tied to LIBOR will support investment income.
However, the company has been witnessing higher expenses over the past several quarters. As Ares Capital continues to invest in the venture growth stage companies, operating expenses are likely to remain elevated.
Why a Positive Earnings Surprise?
According to our quantitative model, the chances of Ares Capital beating the Zacks Consensus Estimate are high this time. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Ares Capital has an Earnings ESP of +1.10%.
Zacks Rank: Ares Capital currently carries a Zacks Rank #3, which further increases the predictive power of ESP.
Other Stocks That Warrant a Look
Here are some other finance stocks that you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.
Bank of Nova Scotia (BNS - Free Report) is scheduled to release results on Feb 26. It has an Earnings ESP of +0.89% and carries a Zacks Rank #3.
Garrison Capital Inc. has an Earnings ESP of +11.94% and has a Zacks Rank #2 (Buy). It is scheduled to report results on Mar 5.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
What's in the Cards for Ares Capital (ARCC) in Q4 Earnings?
Ares Capital Corporation (ARCC - Free Report) is scheduled to announce fourth quarter and 2018 results on Feb 12, before the market opens. Its quarterly revenues and earnings are projected to grow year over year.
In the last reported quarter, the company’s bottom line surpassed the Zacks Consensus Estimate. Results benefited from an increase in total investment income and healthy portfolio activity, partly offset by higher expenses.
The company has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, the average beat being 5.2%.
Ares Capital Corporation Price and EPS Surprise
Ares Capital Corporation Price and EPS Surprise | Ares Capital Corporation Quote
Activities of the company in the fourth quarter were adequate to win analysts’ confidence. As a result, the consensus estimate for earnings of 41 cents moved 2.5% upward over the past 30 days. Also, it reflects a year-over-year improvement of 7.9%.
Further, the Zacks Consensus Estimate for sales of $327.2 million reflects growth of 6.6% on a year-over-year basis.
Before we take a look at what our quantitative model predicts for the to-be-reported quarter, let’s check the factors that are likely to impact the results.
Factors to Impact Q4 Results
Given the expectation of higher prepayment activity during the fourth quarter, total investment income is likely to be positively impacted. Also, with the recent increase in LIBOR rates, Ares Capital’s floating-rate debt investments that are tied to LIBOR will support investment income.
However, the company has been witnessing higher expenses over the past several quarters. As Ares Capital continues to invest in the venture growth stage companies, operating expenses are likely to remain elevated.
Why a Positive Earnings Surprise?
According to our quantitative model, the chances of Ares Capital beating the Zacks Consensus Estimate are high this time. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Ares Capital has an Earnings ESP of +1.10%.
Zacks Rank: Ares Capital currently carries a Zacks Rank #3, which further increases the predictive power of ESP.
Other Stocks That Warrant a Look
Here are some other finance stocks that you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.
Bank of Montreal (BMO - Free Report) is slated to release results on Feb 26. The company has an Earnings ESP of +0.30% and carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Bank of Nova Scotia (BNS - Free Report) is scheduled to release results on Feb 26. It has an Earnings ESP of +0.89% and carries a Zacks Rank #3.
Garrison Capital Inc. has an Earnings ESP of +11.94% and has a Zacks Rank #2 (Buy). It is scheduled to report results on Mar 5.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>