ARES MANAGEMENT CORP - A (ARES) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ARES - US03990B1017 - Common Stock
168.74 USD
-1.55 (-0.91%)
168.74 USD
0 (0%)
Overall ARES gets a fundamental rating of 5 out of 10. We evaluated ARES against 238 industry peers in the Capital Markets industry. ARES has a medium profitability rating, but doesn't score so well on its financial health evaluation. ARES is valued quite expensively, but it does show have an excellent growth rating.
1. Profitability
1.1 Basic Checks
ARES had positive earnings in the past year.
In the past year ARES had a positive cash flow from operations.
In the past 5 years ARES has always been profitable.
ARES had negative operating cash flow in 4 of the past 5 years.
1.2 Ratios
ARES has a Return On Assets (1.89%) which is in line with its industry peers.
ARES has a better Return On Equity (11.44%) than 66.81% of its industry peers.
ARES has a better Return On Invested Capital (4.41%) than 63.03% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ARES is below the industry average of 7.00%.
The last Return On Invested Capital (4.41%) for ARES is above the 3 year average (3.87%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.89% | ||
| ROE | 11.44% | ||
| ROIC | 4.41% |
ROA(3y)1.39%
ROA(5y)1.33%
ROE(3y)15.05%
ROE(5y)15.08%
ROIC(3y)3.87%
ROIC(5y)3.61%
1.3 Margins
ARES has a Profit Margin of 9.56%. This is in the lower half of the industry: ARES underperforms 62.18% of its industry peers.
ARES's Profit Margin has improved in the last couple of years.
ARES has a Operating Margin (19.56%) which is in line with its industry peers.
ARES's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.56% | ||
| PM (TTM) | 9.56% | ||
| GM | N/A |
OM growth 3Y7.41%
OM growth 5Y8.32%
PM growth 3Y6.46%
PM growth 5Y9.3%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The number of shares outstanding for ARES has been increased compared to 1 year ago.
Compared to 5 years ago, ARES has more shares outstanding
ARES has a better debt/assets ratio than last year.
2.2 Solvency
ARES has an Altman-Z score of 1.53. This is a bad value and indicates that ARES is not financially healthy and even has some risk of bankruptcy.
ARES's Altman-Z score of 1.53 is fine compared to the rest of the industry. ARES outperforms 64.29% of its industry peers.
ARES has a debt to FCF ratio of 2.68. This is a good value and a sign of high solvency as ARES would need 2.68 years to pay back of all of its debts.
ARES has a better Debt to FCF ratio (2.68) than 80.25% of its industry peers.
A Debt/Equity ratio of 2.69 is on the high side and indicates that ARES has dependencies on debt financing.
ARES's Debt to Equity ratio of 2.69 is on the low side compared to the rest of the industry. ARES is outperformed by 82.35% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.69 | ||
| Debt/FCF | 2.68 | ||
| Altman-Z | 1.53 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
ARES has a Current Ratio of 0.26. This is a bad value and indicates that ARES is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of ARES (0.26) is worse than 84.45% of its industry peers.
A Quick Ratio of 0.26 indicates that ARES may have some problems paying its short term obligations.
ARES has a worse Quick ratio (0.26) than 84.45% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.26 | ||
| Quick Ratio | 0.26 |
3. Growth
3.1 Past
ARES shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.94%, which is quite good.
The Earnings Per Share has been growing by 18.77% on average over the past years. This is quite good.
The Revenue has grown by 45.54% in the past year. This is a very strong growth!
Measured over the past years, ARES shows a quite strong growth in Revenue. The Revenue has been growing by 17.09% on average per year.
EPS 1Y (TTM)14.94%
EPS 3Y15.6%
EPS 5Y18.77%
EPS Q2Q%25.26%
Revenue 1Y (TTM)45.54%
Revenue growth 3Y-2.66%
Revenue growth 5Y17.09%
Sales Q2Q%0.64%
3.2 Future
Based on estimates for the next years, ARES will show a very strong growth in Earnings Per Share. The EPS will grow by 21.70% on average per year.
Based on estimates for the next years, ARES will show a very strong growth in Revenue. The Revenue will grow by 20.07% on average per year.
EPS Next Y29.38%
EPS Next 2Y28.98%
EPS Next 3Y25.87%
EPS Next 5Y21.7%
Revenue Next Year24.47%
Revenue Next 2Y23.73%
Revenue Next 3Y22.17%
Revenue Next 5Y20.07%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 37.17, the valuation of ARES can be described as expensive.
75.21% of the companies in the same industry are cheaper than ARES, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 26.50, ARES is valued a bit more expensive.
ARES is valuated quite expensively with a Price/Forward Earnings ratio of 25.55.
Based on the Price/Forward Earnings ratio, ARES is valued a bit more expensive than the industry average as 64.71% of the companies are valued more cheaply.
The average S&P500 Price/Forward Earnings ratio is at 23.93. ARES is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.17 | ||
| Fwd PE | 25.55 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ARES is valued a bit cheaper than 61.76% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ARES is valued a bit cheaper than 68.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.28 | ||
| EV/EBITDA | 54.9 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ARES's earnings are expected to grow with 25.87% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.26
PEG (5Y)1.98
EPS Next 2Y28.98%
EPS Next 3Y25.87%
5. Dividend
5.1 Amount
ARES has a Yearly Dividend Yield of 2.69%.
ARES's Dividend Yield is comparable with the industry average which is at 6.43.
Compared to an average S&P500 Dividend Yield of 1.87, ARES pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.69% |
5.2 History
The dividend of ARES has a limited annual growth rate of 5.80%.
ARES has paid a dividend for at least 10 years, which is a reliable track record.
As ARES did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)5.8%
Div Incr Years5
Div Non Decr Years5
5.3 Sustainability
320.11% of the earnings are spent on dividend by ARES. This is not a sustainable payout ratio.
ARES's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP320.11%
EPS Next 2Y28.98%
EPS Next 3Y25.87%
168.74
-1.55 (-0.91%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners84.05%
Inst Owner Change3.47%
Ins Owners2.95%
Ins Owner Change-0.85%
Market Cap55.16B
Revenue(TTM)5.36B
Net Income(TTM)511.84M
Analysts78.33
Price Target189.85 (12.51%)
Short Float %3.2%
Short Ratio1.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.69% |
Yearly Dividend4.22
Dividend Growth(5Y)5.8%
DP320.11%
Div Incr Years5
Div Non Decr Years5
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-3.03%
Min EPS beat(2)-6.98%
Max EPS beat(2)0.92%
EPS beat(4)2
Avg EPS beat(4)-0.05%
Min EPS beat(4)-7.09%
Max EPS beat(4)12.95%
EPS beat(8)3
Avg EPS beat(8)-1.14%
EPS beat(12)5
Avg EPS beat(12)-1.24%
EPS beat(16)7
Avg EPS beat(16)0.06%
Revenue beat(2)2
Avg Revenue beat(2)3.27%
Min Revenue beat(2)0.08%
Max Revenue beat(2)6.46%
Revenue beat(4)3
Avg Revenue beat(4)2.16%
Min Revenue beat(4)-4.32%
Max Revenue beat(4)6.46%
Revenue beat(8)5
Avg Revenue beat(8)6.42%
Revenue beat(12)7
Avg Revenue beat(12)8.82%
Revenue beat(16)10
Avg Revenue beat(16)14.79%
PT rev (1m)0.95%
PT rev (3m)-4.81%
EPS NQ rev (1m)-0.31%
EPS NQ rev (3m)-0.9%
EPS NY rev (1m)0.48%
EPS NY rev (3m)0.64%
Revenue NQ rev (1m)3.44%
Revenue NQ rev (3m)0.45%
Revenue NY rev (1m)-1.95%
Revenue NY rev (3m)-2.94%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.17 | ||
| Fwd PE | 25.55 | ||
| P/S | 10.3 | ||
| P/FCF | 12.28 | ||
| P/OCF | 12.1 | ||
| P/B | 12.33 | ||
| P/tB | N/A | ||
| EV/EBITDA | 54.9 |
EPS(TTM)4.54
EY2.69%
EPS(NY)6.6
Fwd EY3.91%
FCF(TTM)13.74
FCFY8.15%
OCF(TTM)13.95
OCFY8.26%
SpS16.38
BVpS13.69
TBVpS-3.46
PEG (NY)1.26
PEG (5Y)1.98
Graham Number37.39
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.89% | ||
| ROE | 11.44% | ||
| ROCE | 5.06% | ||
| ROIC | 4.41% | ||
| ROICexc | 4.75% | ||
| ROICexgc | 7.2% | ||
| OM | 19.56% | ||
| PM (TTM) | 9.56% | ||
| GM | N/A | ||
| FCFM | 83.89% |
ROA(3y)1.39%
ROA(5y)1.33%
ROE(3y)15.05%
ROE(5y)15.08%
ROIC(3y)3.87%
ROIC(5y)3.61%
ROICexc(3y)4.28%
ROICexc(5y)3.97%
ROICexgc(3y)4.93%
ROICexgc(5y)4.55%
ROCE(3y)4.44%
ROCE(5y)4.15%
ROICexgc growth 3Y1.38%
ROICexgc growth 5Y15.46%
ROICexc growth 3Y1.72%
ROICexc growth 5Y12.7%
OM growth 3Y7.41%
OM growth 5Y8.32%
PM growth 3Y6.46%
PM growth 5Y9.3%
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.69 | ||
| Debt/FCF | 2.68 | ||
| Debt/EBITDA | 9.99 | ||
| Cap/Depr | 41.43% | ||
| Cap/Sales | 1.23% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 377.94% | ||
| Profit Quality | 877.73% | ||
| Current Ratio | 0.26 | ||
| Quick Ratio | 0.26 | ||
| Altman-Z | 1.53 |
F-Score6
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)32.4%
Cap/Depr(5y)31.97%
Cap/Sales(3y)1.79%
Cap/Sales(5y)1.39%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)14.94%
EPS 3Y15.6%
EPS 5Y18.77%
EPS Q2Q%25.26%
EPS Next Y29.38%
EPS Next 2Y28.98%
EPS Next 3Y25.87%
EPS Next 5Y21.7%
Revenue 1Y (TTM)45.54%
Revenue growth 3Y-2.66%
Revenue growth 5Y17.09%
Sales Q2Q%0.64%
Revenue Next Year24.47%
Revenue Next 2Y23.73%
Revenue Next 3Y22.17%
Revenue Next 5Y20.07%
EBIT growth 1Y6.65%
EBIT growth 3Y4.56%
EBIT growth 5Y26.83%
EBIT Next Year38.48%
EBIT Next 3Y45.54%
EBIT Next 5Y17.23%
FCF growth 1Y5204.16%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y3244.68%
OCF growth 3YN/A
OCF growth 5YN/A
ARES MANAGEMENT CORP - A / ARES FAQ
What is the fundamental rating for ARES stock?
ChartMill assigns a fundamental rating of 5 / 10 to ARES.
What is the valuation status of ARES MANAGEMENT CORP - A (ARES) stock?
ChartMill assigns a valuation rating of 3 / 10 to ARES MANAGEMENT CORP - A (ARES). This can be considered as Overvalued.
How profitable is ARES MANAGEMENT CORP - A (ARES) stock?
ARES MANAGEMENT CORP - A (ARES) has a profitability rating of 4 / 10.
What are the PE and PB ratios of ARES MANAGEMENT CORP - A (ARES) stock?
The Price/Earnings (PE) ratio for ARES MANAGEMENT CORP - A (ARES) is 37.17 and the Price/Book (PB) ratio is 12.33.
What is the earnings growth outlook for ARES MANAGEMENT CORP - A?
The Earnings per Share (EPS) of ARES MANAGEMENT CORP - A (ARES) is expected to grow by 29.38% in the next year.