Ares Capital Corporation (ARCC) vs Franklin Resources Inc (BEN)

Ares Capital Corporation and Franklin Resources Inc are both Asset Management companies. Franklin Resources Inc is the larger, with a market value of $16.5B against $13.7B — 1.2× the size. Ares Capital Corporation trades at the lower P/E: 14.2× against 22.5×. Franklin Resources Inc grew revenue faster over the last twelve months: 7.94% against 3.16%. Ares Capital Corporation has the higher net margin (30.9% vs 8.14%) and the higher return on invested capital (3.24% vs 2.27%). Both pay a dividend; Ares Capital Corporation yields more (9.60% vs 4.61%). Across the 21 metrics below, Ares Capital Corporation leads on 14 and Franklin Resources Inc on 7.

Valuation

Metric ARCC BEN Asset Management median
P/E 14.23 22.46 14.62
P/S 4.44 1.82 2.97
P/B 0.99 1.32 0.94
Price to free cash flow n/m 73.45 8.93
EV/EBITDA 12.12 21.51 10.32
EV/Sales 9.32 3.11 5.72
Earnings yield 7.03% 4.45% 4.53%
Free cash flow yield (4.93%) 1.36% 4.65%

Profitability

Metric ARCC BEN Asset Management median
Gross margin 100.00% 100.00% 100.00%
Operating margin 75.76% 9.71% 33.03%
Net margin 30.91% 8.14% 13.53%
Free cash flow margin (21.89%) 2.48% 12.44%
Return on equity 6.88% 5.84% 4.83%
Return on assets 3.22% 2.21% 1.57%
Return on invested capital 3.24% 2.27% 3.04%

Growth

Metric ARCC BEN Asset Management median
Revenue growth (TTM) 3.16% 7.94% 6.97%
EPS growth (last fiscal year) (23.77%) 7.06% —
Revenue growth, 5-year CAGR 15.10% 9.52% 12.13%
Net income growth, 5-year CAGR 21.83% (9.65%) 0.00%

Health

Metric ARCC BEN Asset Management median
Debt to equity 1.14 1.22 0.42
Current ratio 1.28 1.48 1.28
Net debt to EBITDA 6.59 7.18 1.06

Dividend

Metric ARCC BEN Asset Management median
Dividend yield 9.60% 4.61% 6.92%
Payout ratio 1.14 0.74 0.77

Size

Metric ARCC BEN Asset Management median
Market cap 13.72b 16.54b 721.34m

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