EquitableAres Capital

Equitable vs Ares Capital

This page compares Equitable (AXA Equitable Holdings, Inc.) and Ares Capital (Ares Capital Corporation), examining their business models, financial performance, and market context in a clear, neutral ...

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Investment Analysis

Equitable

Pros

  • Equitable Holdings reported record assets under management exceeding $1.1 trillion, reflecting strong flows and market-driven growth in its diversified financial services segments.
  • The company maintains leadership in registered index-linked annuities and has expanded through acquisitions such as Stifel Independent Advisors, supporting wealth management growth.
  • Despite recent revenue volatility, Equitable has demonstrated resilience with a year-over-year increase in adjusted operating earnings per share and a focus on high-margin private markets.

Considerations

  • Equitable’s Q3 2025 revenue fell significantly short of expectations, missing forecasts by nearly 59%, which contributed to a notable drop in its share price.
  • The company’s earnings quality has been questioned due to recent misses on both revenue and adjusted EPS compared to analyst consensus estimates.
  • Equitable’s stock has underperformed the broader market over the past year, signalling investor concerns about growth sustainability and earnings consistency.
Ares Capital

Pros

  • Ares Capital is the largest publicly traded business development company in the US, providing scale advantages in middle-market direct lending and opportunistic credit.
  • The company benefits from a diversified portfolio across industries and geographies, reducing concentration risk and enhancing resilience during market cycles.
  • Ares Capital has consistently maintained a strong dividend yield, supported by stable net investment income and prudent portfolio management.

Considerations

  • As a business development company, Ares Capital’s earnings are sensitive to credit market conditions and potential increases in non-accruals or defaults.
  • Regulatory changes affecting leverage limits or fee structures could impact Ares Capital’s profitability and operational flexibility.
  • The company’s valuation multiples reflect high expectations, leaving limited margin for error if macroeconomic or credit conditions deteriorate.

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