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Home/News Feed/Ares Capital offers a 10.7% dividend yield with a 10% NAV discount, targeting 22% annual returns amid market risks.
ARCC
$18.86
-$0.06 -0.32%

Ares Capital offers a 10.7% dividend yield with a 10% NAV discount, targeting 22% annual returns amid market risks.

Analyst Insights
23 Mar 2026
Seeking Alpha
View Source
Bullish
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Ares Capital, the largest business development company by market cap, provides a diversified portfolio focused on floating-rate middle-market loans. It currently trades at a 10% discount to its net asset value (NAV) and offers a 10.7% dividend yield fully covered by net investment income. Management has de-risked the portfolio by emphasizing first lien senior secured loans and strategically limits exposure to software companies vulnerable to AI disruption. The analyst initiates coverage with a cautious buy rating, projecting a potential 22% annual return if NAV stabilizes, while noting the risks of volatility and market sentiment.

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