Ares Capital Just Extended Its Dividend Streak to 17 Years -- Here's What Its Latest Earnings Show
2026-07-30 11:30
•Matt Dilallo •The Motley Fool
••••• • Axe Cap view
Ares Capital’s Dividend Streak Shows Discipline Amid Slower Deal Flow
Ares Capital extends 17 years of steady dividends despite earnings hiccup, underpinned by strong liquidity and balance sheet.
Ares Capital's ability to maintain its $0.48 quarterly dividend payout for 17 years straight is impressive, especially as its core earnings recently dipped just below that level. What matters here is the buffer: net realized gains and carried-forward taxable income have given the company financial wiggle room so it doesn’t need to cut dividends abruptly. With $6 billion in liquidity and low leverage, Ares has the tools to patiently wait for better deals. For South African investors eyeing yield, this story highlights the value of balance sheet strength over chasing headline earnings. While Ares operates in a US-heavy market and isn’t listed locally, the USD/ZAR rate will affect rand returns if you hold this exposure directly or through ETFs. The risk lies in a prolonged slowdown in lending opportunities, which could force dividend cuts if cushions erode. Still, their discipline is something to watch. this is just our opinion and not financial advice
At the moment, we’d watch Ares but avoid buying unless the USD/ZAR stays stable or weakens, supporting rand returns. This is a special case of a yield play outside the JSE, worth considering selectively.
- ARCC
- USD/ZAR
- prolonged deal slowdown cutting into earnings
- USD strengthening against ZAR reducing rand returns
5/10
Ares Capital maintained its $0.48 quarterly dividend, extending its 17-year streak of dividend stability and growth. While core earnings of $0.47 per share fell slightly below the dividend payment, the company has built a meaningful cushion through net realized gains and carried-forward excess taxable income. With $6 billion in liquidity, modest leverage, and a strong balance sheet, Ares Capital is well-positioned to continue supporting its 10%+ dividend yield despite a slower transaction environment.
Our take is based on reporting first published by The Motley Fool.