ARCC vs. BK, AMP, TROW, STT, NTRS, BEN, SEIC, IVZ, AMG, and MAIN
Should you be buying Ares Capital stock or one of its competitors? The main competitors of Ares Capital include Bank of New York Mellon (BK), Ameriprise Financial (AMP), T. Rowe Price Group (TROW), State Street (STT), Northern Trust (NTRS), Franklin Resources (BEN), SEI Investments (SEIC), Invesco (IVZ), Affiliated Managers Group (AMG), and Main Street Capital (MAIN). These companies are all part of the "asset management & custody banks" industry.
Bank of New York Mellon (NYSE:BK) and Ares Capital (NASDAQ:ARCC) are both large-cap finance companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, media sentiment, community ranking, profitability, risk and earnings.
Bank of New York Mellon pays an annual dividend of $1.88 per share and has a dividend yield of 2.9%. Ares Capital pays an annual dividend of $1.92 per share and has a dividend yield of 9.2%. Bank of New York Mellon pays out 43.5% of its earnings in the form of a dividend. Ares Capital pays out 65.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Bank of New York Mellon has raised its dividend for 14 consecutive years.
Bank of New York Mellon has higher revenue and earnings than Ares Capital. Ares Capital is trading at a lower price-to-earnings ratio than Bank of New York Mellon, indicating that it is currently the more affordable of the two stocks.
In the previous week, Bank of New York Mellon had 4 more articles in the media than Ares Capital. MarketBeat recorded 13 mentions for Bank of New York Mellon and 9 mentions for Ares Capital. Ares Capital's average media sentiment score of 0.80 beat Bank of New York Mellon's score of 0.60 indicating that Bank of New York Mellon is being referred to more favorably in the media.
Bank of New York Mellon received 478 more outperform votes than Ares Capital when rated by MarketBeat users. Likewise, 66.97% of users gave Bank of New York Mellon an outperform vote while only 62.56% of users gave Ares Capital an outperform vote.
Bank of New York Mellon has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Ares Capital has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.
Bank of New York Mellon currently has a consensus price target of $65.23, suggesting a potential downside of 0.54%. Ares Capital has a consensus price target of $21.57, suggesting a potential upside of 3.11%. Given Bank of New York Mellon's stronger consensus rating and higher probable upside, analysts clearly believe Ares Capital is more favorable than Bank of New York Mellon.
85.3% of Bank of New York Mellon shares are owned by institutional investors. Comparatively, 27.4% of Ares Capital shares are owned by institutional investors. 0.1% of Bank of New York Mellon shares are owned by company insiders. Comparatively, 0.6% of Ares Capital shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Ares Capital has a net margin of 62.77% compared to Ares Capital's net margin of 9.40%. Bank of New York Mellon's return on equity of 12.37% beat Ares Capital's return on equity.
Summary
Bank of New York Mellon beats Ares Capital on 13 of the 21 factors compared between the two stocks.
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This chart shows the number of new MarketBeat users adding ARCC and its top 5 competitors to their watchlist. Each company is represented with a line over a 90 day period.
This chart shows the average media sentiment of NASDAQ and its competitors over the past 90 days as caculated by MarketBeat. The averaged score is equivalent to the following: Very Negative Sentiment <= -1.5, Negative Sentiment > -1.5 and <= -0.5, Neutral Sentiment > -0.5 and < 0.5, Positive Sentiment >= 0.5 and < 1.5, and Very Positive Sentiment >= 1.5.
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