Ares Capital Stock Earnings Reports

Ares Capital (ARCC) reported solid first-quarter 2026 results with core EPS of $0.47 (annualized ROE ~9.6%) and GAAP net income per share of $0.13. Portfolio fair value totaled $29.5 billion and NAV was $19.59 per share. Management highlighted healthy portfolio fundamentals: low nonaccruals (2.1% at cost; 1.2% at fair value), ~9% weighted average LTM EBITDA growth for borrowers, broad diversification (607 companies, average position <20 bps) and a conservative balance sheet with approximately $6 billion of available liquidity. Management sees an improving investment backdrop as market volatility and reduced competition have widened spreads (~50–75 bps total improvement noted) and lowered leverage/loans-to-value on new deals, creating opportunities for large, well-capitalized platforms. ARCC originated ~$3.2 billion in Q1 (70% to existing borrowers), recorded $114 million net realized gains, and maintains a stable quarterly dividend of $0.48 (payable June 30). The company engaged a top-tier consulting firm to assess AI risk across its software portfolio and reported the consultant found ~85% of software exposure (by fair value) to be low risk. Management emphasized diversified funding sources, active liability management (issued $750M 5-year notes, expanded a $500M SMBC facility), and that ~70% of Q1 marks were due to mark-to-market spread widening rather than credit deterioration. Backlog was ~$1.8 billion (through April 23) with earlier deals reflecting ~35 bps increase in spreads and ~40 bps increase in fees versus Q1 first-lien loans. Management reiterated discipline on underwriting, vigilance on AI/software exposure, and confidence in ARCC’s ability to deploy capital opportunistically given its liquidity and scale.