Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

What's In The Cards For Ares Capital (ARCC) In Q3 Earnings?

Published 10/27/2019, 11:17 PM
Updated 07/09/2023, 06:31 AM

Ares Capital Corporation (NASDAQ:ARCC) is scheduled to announce third-quarter 2019 results on Oct 30, before the market opens. Its revenues and earnings in the quarter are expected to improve on a year-over-year basis.

In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate. Results benefited from an increase in total investment income and healthy portfolio activity, partly offset by higher expenses.

It has an impressive earnings surprise history. The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 11.4%.

Ares Capital Corporation Price and EPS Surprise

Ares Capital Corporation Price and EPS Surprise

Ares Capital Corporation price-eps-surprise | Ares Capital Corporation Quote

However, activities of Ares Capital in the third quarter failed to win analysts’ confidence. As a result, the Zacks Consensus Estimate for earnings of 46 cents for the to-be-reported quarter has been unchanged over the past 30 days. Nonetheless, the figure indicates 2.2% rise from the year-ago quarter’s reported number.

The consensus estimate for sales of $370.3 million suggests 8.3% growth on a year-over-year basis.

Key Estimates for Q3

The Zacks Consensus Estimate for interest income from investments (constituting more than 75% of the company’s total investment income) is pegged at $295 million, indicating a marginal decline from the prior quarter’s reported figure.

The consensus estimate for capital structuring service fees is pegged at $29.57 million, suggesting a 22.2% decline sequentially. Moreover, the Zacks Consensus Estimate for dividend income of $33.77 million indicates a decline of 11.1% on a sequential basis.

The consensus estimate for other income is pegged at $9.84 million, suggesting a 1.6% fall from the prior quarter’s reported figure.

Ares Capital has been witnessing higher expenses over the past several quarters. As it continues to invest in venture growth stage companies, operating expenses are likely to have remained elevated in the third quarter.

Earnings Whispers

According to our quantitative model, it cannot be conclusively predicted whether Ares Capital will be able to beat the Zacks Consensus Estimate this time around. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Ares Capital has an Earnings ESP of 0.00%.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stocks That Warrant a Look

Here are some finance stocks that you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat in their upcoming releases.

Santander (MC:SAN) Consumer USA Holdings Inc (NYSE:SC) is slated to release results on Oct 30. It presently has an Earnings ESP of +1.01% and a Zacks Rank #3.

Cullen/Frost Bankers, Inc (NYSE:CFR) is slated to release results on Oct 31. It currently has an Earnings ESP of +0.07% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Banco Macro S.A. (NYSE:BMA) is expected to release results on Nov 26. It has an Earnings ESP of +12.20% and a Zacks Rank #3 at present.

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>



Macro Bank Inc. (BMA): Free Stock Analysis Report

Cullen/Frost Bankers, Inc. (CFR): Free Stock Analysis Report

Santander Consumer USA Holdings Inc. (SC): Free Stock Analysis Report

Ares Capital Corporation (ARCC): Free Stock Analysis Report

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.