Forecasting The Future: 5 Analyst Projections For Ares Capital
Throughout the last three months, 5 analysts have evaluated Ares Capital (NASDAQ:ARCC), offering a diverse set of opinions from bullish to bearish.
Summarizing their recent assessments, the table below illustrates the evolving sentiments in the past 30 days and compares them to the preceding months.
| Bullish | Somewhat Bullish | Indifferent | Somewhat Bearish | Bearish | |
|---|---|---|---|---|---|
| Total Ratings | 1 | 4 | 0 | 0 | 0 |
| Last 30D | 0 | 1 | 0 | 0 | 0 |
| 1M Ago | 1 | 2 | 0 | 0 | 0 |
| 2M Ago | 0 | 1 | 0 | 0 | 0 |
| 3M Ago | 0 | 0 | 0 | 0 | 0 |
Insights from analysts' 12-month price targets are revealed, presenting an average target of $22.0, a high estimate of $23.00, and a low estimate of $21.00. Surpassing the previous average price target of $21.50, the current average has increased by 2.33%.
Breaking Down Analyst Ratings: A Detailed Examination
The analysis of recent analyst actions sheds light on the perception of Ares Capital by financial experts. The following summary presents key analysts, their recent evaluations, and adjustments to ratings and price targets.
| Analyst | Analyst Firm | Action Taken | Rating | Current Price Target | Prior Price Target |
|---|---|---|---|---|---|
| Kenneth Lee | RBC Capital | Maintains | Outperform | $22.00 | - |
| Melissa Wedel | JP Morgan | Raises | Overweight | $22.00 | $21.50 |
| Mark Hughes | Truist Securities | Raises | Buy | $23.00 | $22.00 |
| Mitchel Penn | Oppenheimer | Raises | Outperform | $22.00 | $21.00 |
| Devin Ryan | JMP Securities | Maintains | Market Outperform | $21.00 | - |
Key Insights:
- Action Taken: Analysts adapt their recommendations to changing market conditions and company performance. Whether they 'Maintain', 'Raise' or 'Lower' their stance, it reflects their response to recent developments related to Ares Capital. This information provides a snapshot of how analysts perceive the current state of the company.
- Rating: Unveiling insights, analysts deliver qualitative insights into stock performance, from 'Outperform' to 'Underperform'. These ratings convey expectations for the relative performance of Ares Capital compared to the broader market.
- Price Targets: Gaining insights, analysts provide estimates for the future value of Ares Capital's stock. This comparison reveals trends in analysts' expectations over time.
Capture valuable insights into Ares Capital's market standing by understanding these analyst evaluations alongside pertinent financial indicators. Stay informed and make strategic decisions with our Ratings Table.
Stay up to date on Ares Capital analyst ratings.
Get to Know Ares Capital Better
Ares Capital Corp is a United States-based closed-ended specialty finance company. Its investment objective is to generate both current income and capital appreciation through debt and equity investments. The company focuses on investing primarily in U.S. middle-market companies with investment opportunities as well as in larger companies. Its portfolio comprises of first lien senior secured loans, second lien senior secured loans, and mezzanine debt (subordinated unsecured loan), which may include equity components that are diversified by industry and sector. The company may invest in preferred and common equity investments to a lesser proportion. Its revenue mainly consists of interest and dividend income received from the investment made.
Ares Capital: Delving into Financials
Market Capitalization Analysis: Positioned below industry benchmarks, the company's market capitalization faces constraints in size. This could be influenced by factors such as growth expectations or operational capacity.
Positive Revenue Trend: Examining Ares Capital's financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 107.48% as of 31 December, 2023, showcasing a substantial increase in top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Financials sector.
Net Margin: The company's net margin is a standout performer, exceeding industry averages. With an impressive net margin of 93.02%, the company showcases strong profitability and effective cost control.
Return on Equity (ROE): Ares Capital's ROE is below industry averages, indicating potential challenges in efficiently utilizing equity capital. With an ROE of 3.75%, the company may face hurdles in achieving optimal financial returns.
Return on Assets (ROA): Ares Capital's ROA stands out, surpassing industry averages. With an impressive ROA of 1.77%, the company demonstrates effective utilization of assets and strong financial performance.
Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 1.07.
The Basics of Analyst Ratings
Analysts work in banking and financial systems and typically specialize in reporting for stocks or defined sectors. Analysts may attend company conference calls and meetings, research company financial statements, and communicate with insiders to publish "analyst ratings" for stocks. Analysts typically rate each stock once per quarter.
In addition to their assessments, some analysts extend their insights by offering predictions for key metrics such as earnings, revenue, and growth estimates. This supplementary information provides further guidance for traders. It is crucial to recognize that, despite their specialization, analysts are human and can only provide forecasts based on their beliefs.
This article was generated by Benzinga's automated content engine and reviewed by an editor.