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Ares Capital Corporation
🇺🇸 ARCC · NYSE/NASDAQ · US04010L1035
Bank
Scores
Key Metrics
Powered by EODHDP/E (TTM)
14.7
P/E (Price-to-Earnings)Shows how much investors pay for each $1 of profit. We display the TTM P/E (Trailing Twelve Months) which uses actual earnings from the last 4 quarters. This is more reliable than Forward P/E which uses analyst estimates.
Net Debt/EBITDA (TTM)
9.4x
Latest quarter: 20.3x
Net Debt / EBITDAA leverage ratio showing how many years of EBITDA (earnings before interest, taxes, depreciation, and amortization) it would take to repay net debt. EBITDA approximates operating cash generation. Lower ratios (e.g., <3x) are generally safer; higher (e.g., >5x) may indicate more financial risk.
Latest quarter (2026-06-30): 20.3x
The quarterly value can spike when quarterly EBITDA is very low (e.g., one-time charges).
Quick guide: <2x manageable, >4x can be risky (sector-dependent).
ROE
6.9%
ROE (Return on Equity)A profitability measure: how much profit is generated from shareholders’ equity. Higher isn’t always better if it comes from high debt.
EV/EBITDA
10.2x
EV/EBITDAA valuation ratio that compares total business value (including debt) to EBITDA. Lower can mean cheaper, but context matters.
Dividend Summary
Powered by EODHDDividend Yield (Fwd)
10.65%
TTM: 9.70%
Dividend YieldThe Forward yield (Fwd) shows the next announced annual dividend / current price — what you'd earn going forward. The Trailing yield (TTM) in the tooltip shows dividends actually paid in the last 12 months. Forward is shown as primary because it reflects the company's current commitment to shareholders.
Forward Yield (estimated): 10.65%
Trailing Yield (TTM, last 12 months): 9.70%
Payout Ratio (Fwd)
99.0% TTM
Payout RatioDividends as a percentage of earnings. The Forward payout (Fwd) uses the announced dividend divided by actual past earnings (TTM) — it tells you if the company can afford what it promised. Very high payouts can be risky, especially if profits fall.
Announced dividend / actual earnings (TTM)
Dividend History
EODHD Dividends API| Status | Type | Decl. Date | Ex-Div Date | Pay Date | Currency | Amount |
|---|---|---|---|---|---|---|
| Forecast* | Quarterly | — | 15 Jun 2027 | — | USD | 0.48 |
| Forecast* | Quarterly | — | 13 Mar 2027 | — | USD | 0.48 |
| Forecast* | Quarterly | — | 15 Dec 2026 | — | USD | 0.48 |
| Declared | Quarterly | 29 Jul 2026 | 15 Sep 2026 | 30 Sep 2026 | USD | 0.48 |
| Paid | Quarterly | 28 Apr 2026 | 15 Jun 2026 | 30 Jun 2026 | USD | 0.48 |
| Paid | Quarterly | 04 Feb 2026 | 13 Mar 2026 | 31 Mar 2026 | USD | 0.48 |
| Paid | Quarterly | 28 Oct 2025 | 15 Dec 2025 | 30 Dec 2025 | USD | 0.48 |
| Paid | Quarterly | 29 Jul 2025 | 15 Sep 2025 | 30 Sep 2025 | USD | 0.48 |
* Extrapolated from past dividend history. Not an official announcement — treat as an estimate, not a confirmed date or amount.
Summary
Ares Capital remains the premier player in middle-market direct lending, capitalizing on a multi-trillion-dollar structural shift as commercial banks retreat from the space. While near-term cyclical pressures from shifting interest rates and minor legal headwinds warrant monitoring, its massive scale and 9.7% yield offer a highly attractive entry point. Worth considering for new positions by income-focused investors.
Sector Context
As a Business Development Company (BDC) operating under RIC tax rules, ARCC must distribute at least 90% of its taxable income to shareholders, structurally ensuring a high dividend yield. Its permanent, publicly traded capital structure provides a massive competitive advantage over traditional banks (which are constrained by Basel III capital requirements) and non-traded private credit funds (which face redemption risks).
Temporary Opportunity Identified
The stock has faced recent downward pressure (slipping over 10% in the last 6 months) due to fears of interest rate cuts compressing net investment income on floating-rate loans, compounded by headline noise from a derivative lawsuit over asset marks.
📊 Strategy Analysis
- • Structural dominance as the largest publicly traded BDC, benefiting heavily from Basel III regulations that force traditional banks out of middle-market lending.
- • Attractive valuation trading at a P/E (TTM) of 14.65x and a conservative Price-to-NAV premium of just 2.6% (current price $19.85 vs NAV of $19.35).
- • Formidable cash yield of 9.70% backed by a perfect 100/100 dividend consistency score and 9 years of uninterrupted payouts without a single cut.
- • Conservative debt-to-equity ratio of 1.14x, maintaining a substantial safety cushion well below the statutory 150% asset coverage limit (2:1 maximum).
⚠ What to Watch
- • An elevated forward payout ratio of 141.7% and a 5-year EPS decline (-12.0% CAGR) signal vulnerability to net investment income compression as interest rates shift.
- • August 2026 shareholder approval to issue common stock below NAV introduces potential dilution risks if capital is raised during market troughs.
- • An ongoing June 2026 derivative lawsuit alleging inflated valuations on illiquid Level 3 assets and excessive advisory fees presents lingering headline and regulatory risk.
📊 Historical Trends (10 Years)
Powered by EODHDThese charts show how key metrics have evolved over the past decade, helping you identify if the company is improving or deteriorating.
Debt Evolution (Net Debt / EBITDA)
Lower values are better. A declining trend indicates the company is reducing its debt (deleveraging).
Revenue & Earnings Growth
Consistent growth in revenueRevenue
The money a company brings in from selling its products or services. It’s the top line before costs. (blue) and earningsEarnings (Profit)
What’s left after expenses. Positive earnings mean the business made a profit; negative means a loss. (green) indicates a healthy business. Look for upward trends and recoveries after temporary dips.
Analysis date: 2026-08-22
Disclaimer: This information is for educational purposes only. Not financial advice.