ARCC Price Forecast Based on Dividend Discount Model

For dividend yielding stocks, the Dividend Discount Model (DDM) is a common valuation tool; it attempts to extrapolate a fair share price based primarily on the dividend the stock provides relative to a number of other quantiative aspects of its business. As for ARCC, the DDM model, as implemented by StockNews, implies a positive return of 416.22% relative to its current price. Some interesting points we thought investors may wish to consider regarding the dividend discount model forecast for Ares Capital Corp are:

• Relative to all dividend yielding stocks in our set, Ares Capital Corp's dividend yield of 16.48% is in the top 8.5%.
• In terms of opportunity, ARCC's provides a return of 416.22% based on the forecast of the dividend discount model we used relative to its current share price; this is a better return than 91.61% of all stocks we measured with our dividend discount model.
• As other dividend issuers in the Financial Services sector, Ares Capital Corp has an equity discount rate lower than 68.73% of them.

ARCC Dividends vs. Peers