Ares Management (NYSE:ARES) Issues Earnings Results, Beats Estimates By $0.01 EPS

Key Points

• Ares Management narrowly beat earnings estimates: Adjusted EPS was $1.26 versus the $1.25 consensus, while revenue reached $1.43 billion, above expectations of $1.24 billion. EPS increased from $1.15 a year earlier, despite reported revenue declining 13.5% year over year.
• Assets and fundraising continued to grow strongly: Assets under management rose 16% year over year to $691 billion, and Ares raised more than $31 billion during the quarter. The company has $174 billion in available capital, including $117 billion in non-fee-paying AUM that could generate more than $800 million in annual management fees as it becomes productive.
• Near-term challenges remain: Slower U.S. direct-lending activity and delayed realizations pushed some performance-fee income into later periods, with 2026 realized net performance income forecast at $300 million–$325 million. The stock rose 2.8% after the results, and analysts maintain a “Moderate Buy” consensus with a $148.26 average price target.

Ares Management (NYSE:ARES - Get Free Report) released its quarterly earnings data on Thursday. The asset manager reported $1.26 earnings per share for the quarter, topping analysts' consensus estimates of $1.25 by $0.01, FiscalAI reports. Ares Management had a return on equity of 25.42% and a net margin of 10.63%. The company had revenue of $1.43 billion for the quarter, compared to analyst estimates of $1.24 billion. During the same quarter in the previous year, the company posted $1.15 earnings per share. The firm's revenue for the quarter was down 13.5% compared to the same quarter last year.

Here are the key takeaways from Ares Management's conference call:

• Strong third-quarter growth: AUM rose 16% year over year to $691 billion and fee-paying AUM increased 13% to $416 billion. Management fees grew 10% to nearly $1.1 billion, while fee-related earnings increased 19% year to date.
• Fundraising momentum remains robust: Ares raised more than $31 billion in gross capital during the quarter and expects another record fundraising year. Recent successes included an $8 billion first close for U.S. senior direct lending funds, a $4 billion Japan logistics fund close, and strong infrastructure and secondaries demand.
• Significant embedded earnings visibility: The firm ended the quarter with $174 billion of available capital, including $117 billion of AUM not yet paying fees. Deployment or stabilization of these assets could generate more than $800 million in potential incremental annual management fees.
• Diversification and wealth-channel expansion are accelerating: Wealth AUM increased 41% year over year to $82 billion, supported by record inflows into core infrastructure and a broad suite of evergreen products. Infrastructure AUM grew more than 50% over the past year, while secondaries AUM rose approximately 70% over two years.
• U.S. direct-lending activity was temporarily slower and realizations remain delayed: Muted M&A reduced third-quarter deployment, although management cited record pipelines and an expected fourth-quarter pickup. Slower transaction activity pushed some European-style performance-fee payments into later periods, leading Ares to forecast 2026 realized net performance income of $300 million–$325 million.

Ares Management Trading Up 2.8%

NYSE ARES traded up $3.47 during trading on Thursday, hitting $127.29. The stock had a trading volume of 1,645,112 shares, compared to its average volume of 2,893,131. The company has a market capitalization of $42.04 billion, a PE ratio of 58.39, a PEG ratio of 1.11 and a beta of 1.53. The company has a quick ratio of 0.26, a current ratio of 0.26 and a debt-to-equity ratio of 1.00. The firm has a 50 day moving average price of $126.56 and a 200 day moving average price of $125.74. Ares Management has a twelve month low of $95.80 and a twelve month high of $181.19.

Wall Street Analyst Weigh In

ARES has been the subject of several recent analyst reports. Deutsche Bank Aktiengesellschaft restated a "buy" rating and set a $144.00 price objective (up from $140.00) on shares of Ares Management in a research report on Monday, August 3rd. Citizens Jmp cut their price target on shares of Ares Management from $190.00 to $160.00 and set a "market outperform" rating for the company in a report on Thursday, July 9th. Bank of America cut their target price on Ares Management from $160.00 to $156.00 in a research note on Monday, October 5th. Keefe, Bruyette & Woods upgraded Ares Management to a "hold" rating in a research report on Monday, July 20th. Finally, JPMorgan Chase & Co. upped their price target on Ares Management from $143.00 to $153.00 and gave the company an "overweight" rating in a research note on Monday, August 3rd. One analyst has rated the stock with a Strong Buy rating, eleven have given a Buy rating and nine have assigned a Hold rating to the stock. Based on data from MarketBeat.com, Ares Management presently has an average rating of "Moderate Buy" and a consensus target price of $148.26.

Trending Headlines about Ares Management

Here are the key news stories impacting Ares Management this week:

• Positive Sentiment: Adjusted third-quarter earnings were $1.26 per share, narrowly exceeding the $1.25 consensus and rising from $1.15 a year earlier. Revenue of $1.43 billion also surpassed the $1.24 billion estimate. Ares Management Q3 Earnings Beat Estimates, AUM Rises Y/Y
• Positive Sentiment: Assets under management climbed to approximately $690.6 billion, supported by capital inflows and higher management fees. Ares raised more than $31 billion in gross commitments and invested approximately $35 billion during the quarter. Ares Management Corporation Reports Third Quarter 2026 Results
• Positive Sentiment: Fundraising momentum appears particularly strong in private credit and real assets, putting Ares on pace for a record fundraising year. The company also secured an $8 billion first close for its flagship credit fund. Ares Draws $8 Billion for Flagship Credit Fund’s First Close
• Positive Sentiment: U.S. direct-lending activity remained substantial, with $6.3 billion of commitments closed across 55 transactions in the quarter and $43.4 billion over the trailing 12 months. Ares declared a $1.35 quarterly dividend for common shareholders. Ares Management Announces Third Quarter 2026 U.S. Direct Lending Origination Activity
• Neutral Sentiment: Fee-related earnings were $524.2 million and after-tax realized income was $449.6 million, highlighting solid operating cash generation despite weaker GAAP results.
• Negative Sentiment: GAAP net income attributable to Ares fell to $85.3 million, or $0.21 per share, while reported revenue declined 13.5% year over year. This creates a counterweight to the adjusted earnings beat and reflects continued earnings volatility.

About Ares Management

Ares Management Corporation NYSE: ARES is a global alternative investment manager that provides investment solutions across credit, private equity, real assets and secondaries. The company manages capital on behalf of institutional investors, pension funds, insurance companies, sovereign wealth funds, family offices and individual investors.

Its investment activities include direct lending and other credit strategies, control and minority investments in private companies, real estate and infrastructure investments, and secondary-market transactions involving private assets and fund interests.

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