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Ares Capital (ARCC) Gains But Lags Market: What You Should Know

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Ares Capital (ARCC - Free Report) closed the most recent trading day at $18.37, moving +0.22% from the previous trading session. This change lagged the S&P 500's 1.09% gain on the day. At the same time, the Dow added 1.21%, and the tech-heavy Nasdaq gained 1.34%.

Heading into today, shares of the private equity firm had lost 4.51% over the past month, lagging the Finance sector's loss of 1.13% and the S&P 500's loss of 1.17% in that time.

Wall Street will be looking for positivity from ARCC as it approaches its next earnings report date. This is expected to be October 30, 2019. The company is expected to report EPS of $0.46, up 2.22% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $370.25 million, up 8.26% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.86 per share and revenue of $1.50 billion. These totals would mark changes of +10.71% and +12.12%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for ARCC. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. ARCC is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note ARCC's current valuation metrics, including its Forward P/E ratio of 9.84. This represents a premium compared to its industry's average Forward P/E of 9.78.

The Financial - SBIC & Commercial Industry industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 149, which puts it in the bottom 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ARCC in the coming trading sessions, be sure to utilize Zacks.com.


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