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Ares Capital (ARCC) Stock Declines While Market Improves: Some Information for Investors

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Ares Capital (ARCC - Free Report) ended the recent trading session at $20.33, demonstrating a -0.2% swing from the preceding day's closing price. This change lagged the S&P 500's 0.13% gain on the day. Elsewhere, the Dow gained 0.55%, while the tech-heavy Nasdaq lost 0.52%.

Heading into today, shares of the private equity firm had lost 1.78% over the past month, lagging the Finance sector's gain of 4.44% and the S&P 500's gain of 3.67% in that time.

Market participants will be closely following the financial results of Ares Capital in its upcoming release. The company is forecasted to report an EPS of $0.59, showcasing no movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $765.64 million, indicating a 16.89% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates project earnings of $2.38 per share and a revenue of $3 billion, demonstrating changes of +0.42% and +14.75%, respectively, from the preceding year.

Investors should also take note of any recent adjustments to analyst estimates for Ares Capital. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Ares Capital is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Ares Capital has a Forward P/E ratio of 8.55 right now. This indicates a premium in contrast to its industry's Forward P/E of 7.97.

The Financial - SBIC & Commercial Industry industry is part of the Finance sector. Currently, this industry holds a Zacks Industry Rank of 204, positioning it in the bottom 20% 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.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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