ARCC vs. ARES: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at ARCC and ARES, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
ARES’s market capitalization of 38.26 billion USD is significantly greater than ARCC’s 15.56 billion USD, highlighting its more substantial market valuation.
ARES carries a higher beta at 1.40, indicating it’s more sensitive to market moves, while ARCC (beta: 0.73) exhibits greater stability.
| Symbol | ARCC | ARES |
|---|---|---|
| Company Name | Ares Capital Corporation | Ares Management Corporation |
| Country | US | US |
| Sector | Financial Services | Financial Services |
| Industry | Asset Management | Asset Management |
| CEO | Kort Schnabel | Michael J. Arougheti |
| Price | 22.41 USD | 177.96 USD |
| Market Cap | 15.56 billion USD | 38.26 billion USD |
| Beta | 0.73 | 1.40 |
| Exchange | NASDAQ | NYSE |
| IPO Date | October 5, 2004 | May 2, 2014 |
| ADR | No | No |
Historical Performance
This chart compares the performance of ARCC and ARES by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period.
Data is adjusted for dividends and splits.
Profitability
Return on Equity
ARCC
11.03%
Asset Management Industry
- Max
- 34.25%
- Q3
- 18.22%
- Median
- 11.24%
- Q1
- 5.81%
- Min
- -5.72%
ARCC’s Return on Equity of 11.03% is on par with the norm for the Asset Management industry, indicating its profitability relative to shareholder equity is typical for the sector.
ARES
17.03%
Asset Management Industry
- Max
- 34.25%
- Q3
- 18.22%
- Median
- 11.24%
- Q1
- 5.81%
- Min
- -5.72%
ARES’s Return on Equity of 17.03% is on par with the norm for the Asset Management industry, indicating its profitability relative to shareholder equity is typical for the sector.
Return on Invested Capital
ARCC
208.60%
Asset Management Industry
- Max
- 42.18%
- Q3
- 20.06%
- Median
- 8.68%
- Q1
- 3.13%
- Min
- -16.42%
ARCC’s Return on Invested Capital of 208.60% is exceptionally high, placing it well beyond the typical range for the Asset Management industry. This demonstrates an outstanding ability to deploy capital efficiently and create significant value.
ARES
15.74%
Asset Management Industry
- Max
- 42.18%
- Q3
- 20.06%
- Median
- 8.68%
- Q1
- 3.13%
- Min
- -16.42%
ARES’s Return on Invested Capital of 15.74% is in line with the norm for the Asset Management industry, reflecting a standard level of efficiency in generating profits from its capital base.
Net Profit Margin
ARCC
67.48%
Asset Management Industry
- Max
- 91.66%
- Q3
- 57.81%
- Median
- 29.48%
- Q1
- 15.70%
- Min
- -27.65%
A Net Profit Margin of 67.48% places ARCC in the upper quartile for the Asset Management industry, signifying strong profitability and more effective cost management than most of its peers.
ARES
10.46%
Asset Management Industry
- Max
- 91.66%
- Q3
- 57.81%
- Median
- 29.48%
- Q1
- 15.70%
- Min
- -27.65%
Falling into the lower quartile for the Asset Management industry, ARES’s Net Profit Margin of 10.46% indicates weaker profitability. This means the company retains a smaller portion of each dollar in sales as profit compared to its competitors.
Operating Profit Margin
ARCC
91.13%
Asset Management Industry
- Max
- 99.76%
- Q3
- 78.28%
- Median
- 34.76%
- Q1
- 21.75%
- Min
- -48.25%
An Operating Profit Margin of 91.13% places ARCC in the upper quartile for the Asset Management industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
ARES
27.62%
Asset Management Industry
- Max
- 99.76%
- Q3
- 78.28%
- Median
- 34.76%
- Q1
- 21.75%
- Min
- -48.25%
ARES’s Operating Profit Margin of 27.62% is around the midpoint for the Asset Management industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | ARCC | ARES |
|---|---|---|
| Return on Equity (TTM) | 11.03% | 17.03% |
| Return on Assets (TTM) | 5.08% | 1.89% |
| Return on Invested Capital (TTM) | 208.60% | 15.74% |
| Net Profit Margin (TTM) | 67.48% | 10.46% |
| Operating Profit Margin (TTM) | 91.13% | 27.62% |
| Gross Profit Margin (TTM) | 95.92% | 60.51% |
Financial Strength
Current Ratio
ARCC
--
Asset Management Industry
- Max
- 12.44
- Q3
- 5.76
- Median
- 3.04
- Q1
- 1.03
- Min
- 0.01
Current Ratio data for ARCC is currently unavailable.
ARES
0.90
Asset Management Industry
- Max
- 12.44
- Q3
- 5.76
- Median
- 3.04
- Q1
- 1.03
- Min
- 0.01
ARES’s Current Ratio of 0.90 falls into the lower quartile for the Asset Management industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
Debt-to-Equity Ratio
ARCC
--
Asset Management Industry
- Max
- 2.62
- Q3
- 1.42
- Median
- 0.76
- Q1
- 0.34
- Min
- 0.01
Debt-to-Equity Ratio data for ARCC is currently unavailable.
ARES
0.15
Asset Management Industry
- Max
- 2.62
- Q3
- 1.42
- Median
- 0.76
- Q1
- 0.34
- Min
- 0.01
Falling into the lower quartile for the Asset Management industry, ARES’s Debt-to-Equity Ratio of 0.15 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.
Interest Coverage Ratio
ARCC
3.77
Asset Management Industry
- Max
- 13.30
- Q3
- 6.30
- Median
- 2.71
- Q1
- 1.00
- Min
- -6.91
ARCC’s Interest Coverage Ratio of 3.77 is positioned comfortably within the norm for the Asset Management industry, indicating a standard and healthy capacity to cover its interest payments.
ARES
1.95
Asset Management Industry
- Max
- 13.30
- Q3
- 6.30
- Median
- 2.71
- Q1
- 1.00
- Min
- -6.91
ARES’s Interest Coverage Ratio of 1.95 is positioned comfortably within the norm for the Asset Management industry, indicating a standard and healthy capacity to cover its interest payments.
Financial Strength at a Glance
| Symbol | ARCC | ARES |
|---|---|---|
| Current Ratio (TTM) | -- | 0.90 |
| Quick Ratio (TTM) | -- | 0.90 |
| Debt-to-Equity Ratio (TTM) | -- | 0.15 |
| Debt-to-Asset Ratio (TTM) | -- | 0.03 |
| Net Debt-to-EBITDA Ratio (TTM) | -0.35 | 0.04 |
| Interest Coverage Ratio (TTM) | 3.77 | 1.95 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for ARCC and ARES. These metrics are based on the companies’ annual financial reports.
Revenue Growth
Earnings Per Share (EPS) Growth
Free Cash Flow Growth
Dividend
Dividend Yield
ARCC
8.57%
Asset Management Industry
- Max
- 26.09%
- Q3
- 11.60%
- Median
- 6.37%
- Q1
- 2.75%
- Min
- 0.00%
ARCC’s Dividend Yield of 8.57% is consistent with its peers in the Asset Management industry, providing a dividend return that is standard for its sector.
ARES
2.30%
Asset Management Industry
- Max
- 26.09%
- Q3
- 11.60%
- Median
- 6.37%
- Q1
- 2.75%
- Min
- 0.00%
ARES’s Dividend Yield of 2.30% is in the lower quartile for the Asset Management industry. This suggests the company’s strategy likely favors retaining earnings for growth over providing a high dividend income.
Dividend Payout Ratio
ARCC
81.85%
Asset Management Industry
- Max
- 1,034.88%
- Q3
- 127.70%
- Median
- 75.15%
- Q1
- 34.21%
- Min
- 0.00%
ARCC’s Dividend Payout Ratio of 81.85% is within the typical range for the Asset Management industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
ARES
323.36%
Asset Management Industry
- Max
- 1,034.88%
- Q3
- 127.70%
- Median
- 75.15%
- Q1
- 34.21%
- Min
- 0.00%
ARES’s Dividend Payout Ratio of 323.36% is above 100%. This means the company is paying out more in dividends than it earned, a practice that is often unsustainable and could indicate a risk to future dividend stability.
Dividend at a Glance
| Symbol | ARCC | ARES |
|---|---|---|
| Dividend Yield (TTM) | 8.57% | 2.30% |
| Dividend Payout Ratio (TTM) | 81.85% | 323.36% |
Valuation
Price-to-Earnings Ratio
ARCC
10.53
Asset Management Industry
- Max
- 38.72
- Q3
- 23.40
- Median
- 11.45
- Q1
- 8.80
- Min
- 1.54
ARCC’s P/E Ratio of 10.53 is within the middle range for the Asset Management industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
ARES
72.45
Asset Management Industry
- Max
- 38.72
- Q3
- 23.40
- Median
- 11.45
- Q1
- 8.80
- Min
- 1.54
At 72.45, ARES’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Asset Management industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
Forward P/E to Growth Ratio
ARCC
-7.92
Asset Management Industry
- Max
- 6.38
- Q3
- 3.23
- Median
- 1.55
- Q1
- 0.89
- Min
- 0.02
ARCC has a negative Forward PEG Ratio of -7.92. This typically results from negative earnings or forecasts of declining future earnings, making the ratio not meaningful for valuation.
ARES
3.26
Asset Management Industry
- Max
- 6.38
- Q3
- 3.23
- Median
- 1.55
- Q1
- 0.89
- Min
- 0.02
A Forward PEG Ratio of 3.26 places ARES in the upper quartile for the Asset Management industry. This suggests the stock is potentially expensive compared to its peers relative to its growth forecast, which may warrant caution.
Price-to-Sales Ratio
ARCC
7.30
Asset Management Industry
- Max
- 13.75
- Q3
- 7.92
- Median
- 4.87
- Q1
- 3.51
- Min
- 0.02
ARCC’s P/S Ratio of 7.30 aligns with the market consensus for the Asset Management industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
ARES
7.78
Asset Management Industry
- Max
- 13.75
- Q3
- 7.92
- Median
- 4.87
- Q1
- 3.51
- Min
- 0.02
ARES’s P/S Ratio of 7.78 aligns with the market consensus for the Asset Management industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio
ARCC
1.11
Asset Management Industry
- Max
- 5.33
- Q3
- 2.75
- Median
- 1.06
- Q1
- 0.87
- Min
- 0.00
The P/B Ratio is often not a primary valuation metric for the Asset Management industry.
ARES
8.36
Asset Management Industry
- Max
- 5.33
- Q3
- 2.75
- Median
- 1.06
- Q1
- 0.87
- Min
- 0.00
The P/B Ratio is often not a primary valuation metric for the Asset Management industry.
Valuation at a Glance
| Symbol | ARCC | ARES |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 10.53 | 72.45 |
| Forward PEG Ratio (TTM) | -7.92 | 3.26 |
| Price-to-Sales Ratio (P/S, TTM) | 7.30 | 7.78 |
| Price-to-Book Ratio (P/B, TTM) | 1.11 | 8.36 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | -6.47 | 6.96 |
| EV-to-EBITDA (TTM) | 8.15 | 23.40 |
| EV-to-Sales (TTM) | 7.00 | 7.80 |