Ares Capital Corporation (ARCC) , a business development company or BDC boasting an impressive dividend yield of 8.25%, is drawing the attention of income investors. Being a BDC and maintaining its regulated investment company (RIC) status, the company has to distribute roughly 90% of its taxable income as dividends.Over the last few years, ARCC has consistently paid 48 cents per share as a quarterly dividend. It had last announced a dividend hike of 11.6% in October 2022. Over the past five years, the comp ...

Group 1 - The article emphasizes the importance of having a portfolio of stable income generators for both favorable and unfavorable market conditions [2] - The focus is on income-producing asset classes that provide sustainable portfolio income, diversification, and inflation hedging [1] - The investment strategy discussed involves selecting quality stocks that are defensive in nature, with a medium- to long-term investment horizon [2] Group 2 - The article highlights the potential benefits of a two-week free trial for investors to explore top ideas across exclusive income-focused portfolios [1] - It mentions that past performance is not indicative of future results, and no specific investment recommendations are provided [5] - The article clarifies that the opinions expressed may not reflect those of Seeking Alpha as a whole, and analysts may not be licensed or certified [5]

I went to a Prince concert years ago. He opened with one of his hit songs from the '80s -- Let's Go Crazy. I still remember him uttering the first lines of that song, "Dearly beloved, we are gathered here today to get through this thing called life. Electric word, life. It means forever -- and that's a mighty long time."Prince was right: Forever is a mighty long time. Of course, when investors use the word "forever" they might really mean a long time that's easier to envision, perhaps 20 years. With this vi ...

Ares Capital (NASDAQ: ARCC ) missed net investment income expectations for the fourth-quarter earlier this months, but the portfolio is performing well and the BDC is seeing strong growth. Investors in Ares Capital benefit from moderate net investment income growth, highAnalyst’s Disclosure: I/we have a beneficial long position in the shares of ARCC, OBDC, BXSL, FSK either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receivin ...

Core Viewpoint - Ares Capital (NASDAQ: ARCC) has consistently demonstrated the ability to outperform its payouts, maintaining a constant dividend despite strong earnings [1]. Group 1 - The February report for December confirmed the company's ability to deliver on its financial commitments [1]. - Management has decided to keep the dividend steady, indicating confidence in the company's financial health [1]. - The company has a history of resilience, having navigated through significant market crashes in 1987, 2000, and 2008 [1].

Group 1 - The article emphasizes the importance of innovation and disruption in the financial sector, particularly focusing on high-tech and early growth companies [1] - It highlights the potential investment opportunities in growth buyouts and value stocks, suggesting a strategic approach to investment in these areas [1] Group 2 - The article does not provide specific financial data or performance metrics related to any particular company or industry [2][3]

Group 1 - Charlie Munger is recognized as a significant investment thought-leader whose advice has influenced investment approaches [1] Group 2 - Roberts Berzins has over a decade of experience in financial management, assisting top-tier corporates in shaping financial strategies and executing large-scale financings [2] - Berzins has contributed to institutionalizing the REIT framework in Latvia to enhance the liquidity of pan-Baltic capital markets [2] - His policy-level work includes developing national SOE financing guidelines and frameworks for channeling private capital into affordable housing [2] - Berzins holds a CFA Charter and an ESG investing certificate, and has interned at the Chicago Board of Trade [2] - He is actively involved in thought-leadership activities to support the development of pan-Baltic capital markets [2]

One of my favorite BDCs, Ares Capital (NASDAQ: ARCC ) recently announced their fourth quarter earnings report to close out the fiscal year. Shortly after the stock sold-off to what, I thought, was an overreaction to their earnings miss, which I'll delve into laterContributing analyst to the iREIT+Hoya Capital investment group. The Dividend Collectuh is not a registered investment professional nor financial advisor and these articles should not be taken as financial advice. This is for educational purposes o ...

Group 1 - Ares Capital (NASDAQ: ARCC) recently released its Q4 2024 earnings deck, which led to a negative market reaction with a share price decline of approximately 4% [1] - The market's response to the earnings report was characterized as a correction, although it was not significant [1] Group 2 - Roberts Berzins has over a decade of experience in financial management, assisting top-tier corporates in shaping financial strategies and executing large-scale financings [1] - Berzins has contributed to institutionalizing the REIT framework in Latvia to enhance the liquidity of pan-Baltic capital markets [1] - His policy-level work includes developing national SOE financing guidelines and frameworks for channeling private capital into affordable housing [1]

Company Overview - Ares Capital is a business development company (BDC) that provides capital to middle-market companies with annual EBITDA between $10 million and $250 million, aiming to invest between $30 million and $500 million in debt and equity [2] - Traditional banks are often hesitant to lend to these riskier clients, allowing BDCs like Ares to fill this niche by offering higher-interest loans [3] Financial Performance - Ares Capital's stock has increased approximately 40% over the past decade, with a total return of nearly 260% when including reinvested dividends [1] - The company's debt-to-equity ratio has improved from 1.21 in 2021 to 0.99 in 2024, while net assets per share have increased from $18.96 in 2021 to $19.89 in 2024 [7] - Ares' stock is currently trading at a premium of about 15% to its net assets per share, which may limit near-term gains [7] Dividend Safety - In 2024, Ares generated core earnings per share (EPS) of $2.33 and paid out $1.92 per share in dividends, resulting in a forward yield of 8.3% [9] - Analysts project a 6% decline in core EPS to $2.19 per share in 2025, but the company is expected to cover its dividend payments comfortably [10] Market Position - Ares Capital has diversified its investments across 535 companies, with 63% of its portfolio in first- and second-lien secured loans, providing a safety net in case of bankruptcy [5] - In comparison, its competitor Main Street Capital has a lower debt-to-equity ratio of 0.89 and is expected to have lower net assets per share than its current stock price [8] Investment Considerations - Ares Capital's stock is viewed as a compelling buy at current prices, especially given its high dividend yield, despite concerns about reaching the $26 price target in the near future [12] - Declining interest rates may reduce Ares' bottom-line growth but could enhance the attractiveness of its dividend compared to fixed-income investments [11]