GET DAILY SIGNALSAres Management (ARES) Beats Earnings Estimates with +16% AUM Growth in Q3
Key Takeaways
- Ares Management reported after-tax realized income per share of $1.26, edging past the Zacks Consensus Estimate of $1.25 and up from $1.19 a year earlier.
- Total assets under management (AUM, the total value of assets the firm manages for clients) rose 16% year over year to about $691 billion, while fee-paying AUM climbed 13% to roughly $416 billion.
- The firm raised more than $31 billion in gross capital commitments and invested $35 billion during the quarter, with over half of inflows coming from outside its Credit Group.
- Fee-related earnings (FRE, recurring earnings generated from management fees before performance income) reached $524.2 million, and the FRE margin improved to 42.5% from 41.4%.
- Management declared a quarterly dividend of $1.35 per share, a 20% increase from the prior-year period.
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Earnings Context and Why It Matters
Ares Management stands as one of the world's largest alternative investment managers, with operations spanning credit, real estate, private equity, secondaries, and infrastructure. Its quarterly results draw close attention because AUM trends and fundraising activity serve as key signals for future management-fee growth, while deployment levels reflect the overall health of private credit and real asset markets. The third quarter unfolded against a backdrop of uneven transaction activity and shifting interest-rate expectations. After a strong fundraising run, the focus was on whether Ares could maintain inflows and turn new capital into fees, along with how management viewed the path ahead for the fourth quarter and 2027.
Reported Results
For the third quarter ended September 30, 2026, Ares Management reported GAAP net income attributable to the company of $85.3 million, or $0.21 per diluted share, down from $288.9 million in the year-ago period. The drop mainly stemmed from lower performance-related income. On an after-tax realized income basis, a measure many analysts favor for alternative asset managers, Ares posted $449.6 million, or $1.26 per share. That figure narrowly beat the Zacks Consensus Estimate of $1.25 and improved from $1.19 a year earlier. Fee-related earnings came in at $524.2 million. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Reported revenue of $1.19 billion missed the Zacks Consensus Estimate by 6.2% but rose from $1.16 billion a year ago. Management fees increased to $1.06 billion from $971.8 million, while carried interest allocation fell to $161.7 million from $464.7 million and incentive fees declined to $82.3 million from $100.7 million. Total AUM reached about $691 billion, and fee-paying AUM rose to approximately $416 billion.
Market Reaction and Investor Sentiment
Sentiment around the report was mixed. The earnings beat on the after-tax realized income metric and the 20% dividend increase underscored confidence in recurring earnings growth, while record gross fundraising reinforced the firm's franchise strength. However, the revenue miss relative to consensus and softer incentive fees highlighted that performance-linked income remains volatile from quarter to quarter. Investors also noted management's disclosure that realized net performance income guidance for the full year was reduced to a range of $300 million to $325 million, reflecting delays in certain European payments. Commentary on record fourth-quarter pipelines and improving deployment trends helped temper near-term concerns about slower U.S. direct lending activity.
Forward Outlook and Key Factors to Monitor
Looking ahead, management reiterated expectations for another record fundraising year and expressed confidence in a strong fourth quarter, historically its strongest deployment season. A key watchpoint is whether newly raised capital converts efficiently into fee-paying AUM, since Ares flagged substantial capital already raised but not yet earning fees as a source of future management-fee growth.
Investors should monitor the pace of U.S. direct lending deployment, which slowed in the third quarter amid muted merger-and-acquisition activity but entered the fourth quarter with record pipelines. Fee-related earnings margin expansion is another focal point, with management guiding full-year margin growth slightly above the midpoint of its target range due to the timing of fund closes.
Finally, watch developments in digital infrastructure and data-center fundraising, which management framed as a meaningful 2027 earnings catalyst, alongside continued momentum in secondaries, real estate, and infrastructure strategies. Higher short-term interest rates remain broadly constructive for the firm's floating-rate credit portfolios.
Using AI Tools in My Research
In my analysis of alternative asset managers like Ares Management, I often turn to Tickeron’s AI Screener to quickly filter ideas and compare fundamentals across the sector. It helps surface relevant patterns and performance metrics without spending hours on manual reviews, which keeps my process efficient when tracking names in this space.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
Momentum Indicator for ARES turns positive, indicating new upward trend
ARES saw its Momentum Indicator move above the 0 level on October 21, 2026. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 98 similar instances where the indicator turned positive. In 81 of the 98 cases, the stock moved higher in the following days. The odds of a move higher are at 83%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where ARES's RSI Oscillator exited the oversold zone, 17 of 21 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 81%.
The Moving Average Convergence Divergence (MACD) for ARES just turned positive on October 12, 2026. Looking at past instances where ARES's MACD turned positive, the stock continued to rise in 33 of 46 cases over the following month. The odds of a continued upward trend are 72%.
Following a +1.59% 3-day Advance, the price is estimated to grow further. Considering data from situations where ARES advanced for three days, in 254 of 334 cases, the price rose further within the following month. The odds of a continued upward trend are 76%.
Bearish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 4 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ARES declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 66%.
ARES broke above its upper Bollinger Band on October 22, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for ARES entered a downward trend on October 26, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Fundamental Analysis (Ratings)
The Tickeron Price Growth Rating for this company is 56 (best 1 - 100 worst), indicating steady price growth. ARES’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 60 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock slightly better than average.
The Tickeron PE Growth Rating for this company is 80 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 91 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: ARES's P/B Ratio (11.229) is slightly higher than the industry average of (2.397). P/E Ratio (56.798) is within average values for comparable stocks, (-3.450). Projected Growth (PEG Ratio) (0.879) is also within normal values, averaging (1.319). Dividend Yield (0.044) settles around the average of (0.272) among similar stocks. P/S Ratio (4.623) is also within normal values, averaging (15.798).
The Tickeron SMR rating for this company is 95 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Seasonality Score of 95 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
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