Ares Capital Corporation (ARCC) vs Equitable Holdings, Inc. (EQH)

Ares Capital Corporation and Equitable Holdings, Inc. are both Asset Management companies. Ares Capital Corporation and Equitable Holdings, Inc. are of similar size ($14.4B and $13.7B). Equitable Holdings, Inc. has negative trailing earnings, so its P/E is not meaningful; Ares Capital Corporation trades at 14.2×. Ares Capital Corporation grew revenue faster over the last twelve months: 3.16% against −22.1%. Ares Capital Corporation has the higher net margin (30.9% vs −9.25%) and the higher return on invested capital (3.24% vs 0.00%). Across the 19 metrics below, Ares Capital Corporation leads on 14 and Equitable Holdings, Inc. on 5.

Valuation

Metric ARCC EQH Asset Management median
P/E 14.23 n/m 14.62
P/S 4.44 1.41 2.97
P/B 0.99 n/m 0.94
Price to free cash flow n/m 11.34 8.93
EV/EBITDA 12.12 9.25 10.32
EV/Sales 9.32 0.45 5.72
Earnings yield 7.03% (6.09%) 4.53%
Free cash flow yield (4.93%) 8.82% 4.65%

Profitability

Metric ARCC EQH Asset Management median
Gross margin 100.00% 44.18% 100.00%
Operating margin 75.76% (3.62%) 33.03%
Net margin 30.91% (9.25%) 13.53%
Free cash flow margin (21.89%) 12.44% 12.44%
Return on equity 6.88% (168.29%) 4.83%
Return on assets 3.22% (0.31%) 1.57%
Return on invested capital 3.24% 0.00% 3.04%

Growth

Metric ARCC EQH Asset Management median
Revenue growth (TTM) 3.16% (22.10%) 6.97%
EPS growth (last fiscal year) (23.77%) (227.78%) —
Revenue growth, 5-year CAGR 15.10% (1.24%) 12.13%
Net income growth, 5-year CAGR 21.83% 0.00% 0.00%

Health

Metric ARCC EQH Asset Management median
Debt to equity 1.14 8.12 0.42
Current ratio 1.28 0.12 1.28
Net debt to EBITDA 6.59 60.82 1.06

Dividend

Metric ARCC EQH Asset Management median
Dividend yield 9.60% — 6.92%
Payout ratio 1.14 — 0.77

Size

Metric ARCC EQH Asset Management median
Market cap 13.72b 14.36b 721.34m

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