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Are Finance Stocks Lagging Ares Capital (ARCC) This Year?

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The Finance group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Has Ares Capital (ARCC - Free Report) been one of those stocks this year? By taking a look at the stock's year-to-date performance in comparison to its Finance peers, we might be able to answer that question.

Ares Capital is one of 873 companies in the Finance group. The Finance group currently sits at #1 within the Zacks Sector Rank. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Rank of the individual stocks within the groups is measured, and the sectors are listed from best to worst.

The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Ares Capital is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for ARCC's full-year earnings has moved 0.3% higher. This shows that analyst sentiment has improved and the company's earnings outlook is stronger.

According to our latest data, ARCC has moved about 8.1% on a year-to-date basis. At the same time, Finance stocks have gained an average of 4.9%. This means that Ares Capital is performing better than its sector in terms of year-to-date returns.

Another stock in the Finance sector, American Express (AXP - Free Report) , has outperformed the sector so far this year. The stock's year-to-date return is 7%.

In American Express' case, the consensus EPS estimate for the current year increased 0.9% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Looking more specifically, Ares Capital belongs to the Financial - SBIC & Commercial Industry industry, a group that includes 37 individual stocks and currently sits at #56 in the Zacks Industry Rank. This group has gained an average of 5.6% so far this year, so ARCC is performing better in this area.

In contrast, American Express falls under the Financial - Miscellaneous Services industry. Currently, this industry has 87 stocks and is ranked #87. Since the beginning of the year, the industry has moved +5.5%.

Investors interested in the Finance sector may want to keep a close eye on Ares Capital and American Express as they attempt to continue their solid performance.


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