ARCC vs. NU: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at ARCC and NU, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
NU’s market capitalization of 65.46 billion USD is significantly greater than ARCC’s 15.56 billion USD, highlighting its more substantial market valuation.
With betas of 0.73 for ARCC and 1.04 for NU, both stocks show similar sensitivity to overall market movements.
| Symbol | ARCC | NU |
|---|---|---|
| Company Name | Ares Capital Corporation | Nu Holdings Ltd. |
| Country | US | BR |
| Sector | Financial Services | Financial Services |
| Industry | Asset Management | Banks - Diversified |
| CEO | Kort Schnabel | David Velez-Osomo |
| Price | 22.41 USD | 13.6 USD |
| Market Cap | 15.56 billion USD | 65.46 billion USD |
| Beta | 0.73 | 1.04 |
| Exchange | NASDAQ | NYSE |
| IPO Date | October 5, 2004 | December 9, 2021 |
| ADR | No | No |
Historical Performance
This chart compares the performance of ARCC and NU 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.
NU
27.91%
Banks - Diversified Industry
- Max
- 20.93%
- Q3
- 14.73%
- Median
- 12.33%
- Q1
- 9.14%
- Min
- 5.86%
NU’s Return on Equity of 27.91% is exceptionally high, placing it well beyond the typical range for the Banks - Diversified industry. This demonstrates a superior ability to generate profit from shareholder investments, though it could also be inflated by high financial leverage.
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.
NU
17.44%
Banks - Diversified Industry
- Max
- 4.52%
- Q3
- 2.95%
- Median
- 1.89%
- Q1
- 0.86%
- Min
- 0.18%
Return on Invested Capital is often not a primary measure of capital efficiency in the Banks - Diversified industry.
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.
NU
18.52%
Banks - Diversified Industry
- Max
- 33.40%
- Q3
- 26.40%
- Median
- 19.24%
- Q1
- 14.99%
- Min
- 7.95%
NU’s Net Profit Margin of 18.52% is aligned with the median group of its peers in the Banks - Diversified industry. This indicates its ability to convert revenue into profit is typical for the sector.
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.
NU
25.94%
Banks - Diversified Industry
- Max
- 50.90%
- Q3
- 37.76%
- Median
- 28.44%
- Q1
- 15.73%
- Min
- 8.60%
NU’s Operating Profit Margin of 25.94% is around the midpoint for the Banks - Diversified industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | ARCC | NU |
|---|---|---|
| Return on Equity (TTM) | 11.03% | 27.91% |
| Return on Assets (TTM) | 5.08% | 3.97% |
| Return on Invested Capital (TTM) | 208.60% | 17.44% |
| Net Profit Margin (TTM) | 67.48% | 18.52% |
| Operating Profit Margin (TTM) | 91.13% | 25.94% |
| Gross Profit Margin (TTM) | 95.92% | 45.04% |
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.
NU
0.99
Banks - Diversified Industry
- Max
- 0.67
- Q3
- 0.49
- Median
- 0.39
- Q1
- 0.28
- Min
- 0.06
For the Banks - Diversified industry, the Current Ratio is often not the most suitable measure of short-term liquidity.
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.
NU
0.10
Banks - Diversified Industry
- Max
- 4.98
- Q3
- 3.65
- Median
- 3.13
- Q1
- 1.73
- Min
- 0.09
Falling into the lower quartile for the Banks - Diversified industry, NU’s Debt-to-Equity Ratio of 0.10 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.
NU
0.98
Banks - Diversified Industry
- Max
- 0.98
- Q3
- 0.78
- Median
- 0.55
- Q1
- 0.31
- Min
- 0.09
The Interest Coverage Ratio is often not a primary indicator of debt servicing capacity in the Banks - Diversified industry.
Financial Strength at a Glance
| Symbol | ARCC | NU |
|---|---|---|
| Current Ratio (TTM) | -- | 0.99 |
| Quick Ratio (TTM) | -- | 0.99 |
| Debt-to-Equity Ratio (TTM) | -- | 0.10 |
| Debt-to-Asset Ratio (TTM) | -- | 0.02 |
| Net Debt-to-EBITDA Ratio (TTM) | -0.35 | -4.55 |
| Interest Coverage Ratio (TTM) | 3.77 | 0.98 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for ARCC and NU. 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.
NU
0.00%
Banks - Diversified Industry
- Max
- 7.73%
- Q3
- 4.16%
- Median
- 3.24%
- Q1
- 2.27%
- Min
- 0.00%
NU currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
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.
NU
0.00%
Banks - Diversified Industry
- Max
- 84.94%
- Q3
- 39.11%
- Median
- 26.91%
- Q1
- 0.00%
- Min
- 0.00%
NU has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
Dividend at a Glance
| Symbol | ARCC | NU |
|---|---|---|
| Dividend Yield (TTM) | 8.57% | 0.00% |
| Dividend Payout Ratio (TTM) | 81.85% | 0.00% |
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.
NU
30.46
Banks - Diversified Industry
- Max
- 14.13
- Q3
- 13.37
- Median
- 11.90
- Q1
- 9.29
- Min
- 7.43
At 30.46, NU’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Banks - Diversified 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.
NU
-0.30
Banks - Diversified Industry
- Max
- 1.98
- Q3
- 1.41
- Median
- 1.15
- Q1
- 0.77
- Min
- 0.45
NU has a negative Forward PEG Ratio of -0.30. This typically results from negative earnings or forecasts of declining future earnings, making the ratio not meaningful for valuation.
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.
NU
5.64
Banks - Diversified Industry
- Max
- 4.15
- Q3
- 2.92
- Median
- 2.29
- Q1
- 1.83
- Min
- 0.94
The P/S Ratio is often not a primary valuation tool in the Banks - Diversified industry.
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.
NU
7.61
Banks - Diversified Industry
- Max
- 1.89
- Q3
- 1.47
- Median
- 1.23
- Q1
- 1.10
- Min
- 0.65
At 7.61, NU’s P/B Ratio is at an extreme premium to the Banks - Diversified industry. This signifies that the market’s valuation is heavily reliant on future potential rather than its current net asset value, which can be a high-risk proposition.
Valuation at a Glance
| Symbol | ARCC | NU |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 10.53 | 30.46 |
| Forward PEG Ratio (TTM) | -7.92 | -0.30 |
| Price-to-Sales Ratio (P/S, TTM) | 7.30 | 5.64 |
| Price-to-Book Ratio (P/B, TTM) | 1.11 | 7.61 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | -6.47 | 17.12 |
| EV-to-EBITDA (TTM) | 8.15 | 16.62 |
| EV-to-Sales (TTM) | 7.00 | 4.43 |