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ARCC vs HTGC
Which Stock Would AI Choose? Ares Capital (ARCC) vs. Hercules Capital (HTGC) Stock Comparison
Key Takeaways
- Both ARCC and HTGC are business development companies (BDCs) that lend to private, middle-market and venture-stage firms and pay high dividend yields near or above 10%.
- Ares Capital is the largest publicly traded BDC, while Hercules Capital is a smaller, faster-growing specialist focused on technology and life sciences.
- Ares Capital trades at a modest discount to net asset value (NAV), whereas Hercules Capital has historically commanded a premium to NAV due to its growth profile.
- Hercules Capital has posted record originations and strong net investment income (NII) coverage, while Ares Capital's core earnings have recently dipped slightly below its dividend.
- Tickeron AI Verdict: Based on trend consistency, income momentum, and credit stability, the AI framework currently leans toward HTGC over ARCC.
- For more detail, explore ARCC Major News and ARCC Today's Price Move, as well as HTGC Major News and HTGC Today's Price Move.
- Interested in systematic strategies? Explore Trending AI Robots to see how automated tools approach stock selection.
Introduction
Investors drawn to high-yield specialty finance often encounter the same two names: ARCC (Ares Capital Corporation) and HTGC (Hercules Capital, Inc.). Both are business development companies (BDCs) that generate income by lending to private companies, and both distribute most of that income to shareholders. Yet their business models, growth drivers, and market positioning differ meaningfully. This stock comparison examines relative performance, momentum, and risk so that income-oriented investors and traders can better assess which name suits the current market environment.
ARCC Overview and Recent Performance
Ares Capital is the largest publicly traded BDC, with an investment portfolio of roughly $29 billion spread across hundreds of middle-market companies. The firm primarily holds first-lien senior secured loans, backed by a wide network of private equity sponsors, which supports diversification and scale. In recent weeks, Ares Capital has attracted attention for its agreement to acquire MidCap Financial Investment Corporation in a transaction valued at about $2.6 billion, a move expected to modestly support future core earnings per share.
Recent market activity, however, has highlighted softer momentum. Core earnings per share came in around $0.46 in the latest quarter, slightly below the regular $0.48 quarterly dividend, and non-accrual loans edged up to about 2.4% of the portfolio at amortized cost — still below the company's historical average but a trend investors are watching. Shares trade near a slight discount to NAV, with a dividend yield around 10%, reflecting both the firm's scale advantages and some concern about tighter dividend coverage.
HTGC Overview and Recent Performance
Hercules Capital is a specialty finance company focused on venture debt and growth capital for technology and life sciences companies. Its platform now manages roughly $6.5 billion in assets, up sharply from a year earlier, and the firm has emphasized a disciplined, first-lien-heavy approach with a large share of floating-rate loans. In recent quarters, Hercules has reported record origination activity and record total investment income, with net investment income covering its base distribution by a comfortable margin.
From a relative performance standpoint, Hercules has shown stronger income momentum than many BDC peers, supported by record year-to-date commitments and healthy early loan repayments. Credit quality has remained stable, with non-accruals near historically low levels. The trade-off is valuation: Hercules shares have historically traded at a meaningful premium to NAV, which can make the stock more sensitive to sentiment shifts even as its growth narrative remains intact.
Trending AI Robots
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Head-to-Head Comparison
The clearest contrast between these two BDCs is diversification versus specialization. Ares Capital's portfolio spans hundreds of middle-market companies across many industries, favoring first-lien senior secured loans and offering scale and sponsor relationships that competitors find hard to match. Hercules Capital, by contrast, concentrates on venture-backed technology and life sciences borrowers, a focus that brings higher growth potential and equity upside through warrants but also greater exposure to a narrower set of sectors.
Momentum and credit trends also diverge. Hercules has been posting record originations and comfortably covering its distribution, while Ares Capital's core earnings have slipped slightly below its dividend and its non-accrual rate has ticked higher. On valuation, however, the roles reverse: Ares Capital trades near or below NAV, whereas Hercules carries a premium to NAV that reflects its growth premium. For income stability, Ares Capital's scale and 17-plus-year dividend record stand out; for growth and credit momentum, Hercules has recently held the edge.
Tickeron AI Verdict
Weighing trend consistency, income momentum, credit stability, and relative positioning, Tickeron's AI framework would currently lean toward HTGC. The assessment rests on observable factors: record origination activity, robust net investment income coverage, and low non-accruals point to a steadier near-term earnings trajectory, while Ares Capital's modest earnings dip and rising non-accruals introduce slightly more uncertainty. This is a probabilistic view rather than a definitive prediction, and valuation premium remains a key risk for Hercules that could shift the balance as conditions evolve.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is ARCC is a Buy and HTGC is a StrongBuy.
ARCC in upward trend: price rose above 50-day moving average on November 04, 2026
ARCC moved above its 50-day moving average on November 04, 2026 date and that indicates a change from a downward trend to an upward trend. In 28 of 44 similar past instances, the stock price increased further within the following month. The odds of a continued upward trend are 64%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where ARCC's RSI Indicator exited the oversold zone, 11 of 22 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 50%.
The Momentum Indicator moved above the 0 level on October 29, 2026. You may want to consider a long position or call options on ARCC as a result. In 43 of 89 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 48%.
The Moving Average Convergence Divergence (MACD) for ARCC just turned positive on October 22, 2026. Looking at past instances where ARCC's MACD turned positive, the stock continued to rise in 20 of 46 cases over the following month. The odds of a continued upward trend are 43%.
The 10-day moving average for ARCC crossed bullishly above the 50-day moving average on November 09, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 7 of 14 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 50%.
Following a +0.57% 3-day Advance, the price is estimated to grow further. Considering data from situations where ARCC advanced for three days, in 133 of 342 cases, the price rose further within the following month. The odds of a continued upward trend are 39%.
The Aroon Indicator entered an Uptrend today. In 104 of 309 cases where ARCC Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 34%.
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ARCC 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 40%.
ARCC broke above its upper Bollinger Band on November 02, 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.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 11 (best 1 - 100 worst), indicating very strong sales and a profitable 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 PE Growth Rating for this company is 12 (best 1 - 100 worst), pointing to outstanding 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 Profit vs. Risk Rating rating for this company is 26 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 80, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 48 (best 1 - 100 worst), indicating steady price growth. ARCC’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued 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.
The Tickeron Valuation Rating of 86 (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: P/B Ratio (0.989) is normal, around the industry mean (2.412). P/E Ratio (14.276) is within average values for comparable stocks, (-2.386). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (1.319). Dividend Yield (0.100) settles around the average of (0.270) among similar stocks. P/S Ratio (11.792) is also within normal values, averaging (15.694).
HTGC's RSI Oscillator recovers from oversold territory
The RSI Oscillator for HTGC moved out of oversold territory on October 08, 2026. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 23 similar instances when the indicator left oversold territory. In 20 of the 23 cases the stock moved higher. This puts the odds of a move higher at 87%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 24 of 44 cases where HTGC's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 55%.
The Moving Average Convergence Divergence (MACD) for HTGC just turned positive on October 23, 2026. Looking at past instances where HTGC's MACD turned positive, the stock continued to rise in 27 of 40 cases over the following month. The odds of a continued upward trend are 68%.
Following a +2.70% 3-day Advance, the price is estimated to grow further. Considering data from situations where HTGC advanced for three days, in 185 of 331 cases, the price rose further within the following month. The odds of a continued upward trend are 56%.
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on November 11, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on HTGC as a result. In 42 of 88 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 48%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where HTGC 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 50%.
HTGC broke above its upper Bollinger Band on October 29, 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 HTGC entered a downward trend on October 28, 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 SMR rating for this company is 17 (best 1 - 100 worst), indicating very strong sales and a profitable 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 Profit vs. Risk Rating rating for this company is 38 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 80, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is 50 (best 1 - 100 worst), indicating steady price growth. HTGC’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 77 (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 85 (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: P/B Ratio (1.330) is normal, around the industry mean (2.412). P/E Ratio (7.732) is within average values for comparable stocks, (-2.386). Projected Growth (PEG Ratio) (0.525) is also within normal values, averaging (1.319). Dividend Yield (0.116) settles around the average of (0.270) among similar stocks. P/S Ratio (7.102) is also within normal values, averaging (15.694).
ARCC | HTGC | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 22 | 71 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 86 Overvalued | 85 Overvalued | |
PROFIT vs RISK RATING 1..100 | 26 | 38 | |
SMR RATING 1..100 | 11 | 17 | |
PRICE GROWTH RATING 1..100 | 48 | 50 | |
P/E GROWTH RATING 1..100 | 12 | 77 | |
SEASONALITY SCORE 1..100 | 50 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
HTGC's Valuation (85) in the null industry is in the same range as ARCC (86). This means that HTGC’s stock grew similarly to ARCC’s over the last 12 months.
ARCC's Profit vs Risk Rating (26) in the null industry is in the same range as HTGC (38). This means that ARCC’s stock grew similarly to HTGC’s over the last 12 months.
ARCC's SMR Rating (11) in the null industry is in the same range as HTGC (17). This means that ARCC’s stock grew similarly to HTGC’s over the last 12 months.
ARCC's Price Growth Rating (48) in the null industry is in the same range as HTGC (50). This means that ARCC’s stock grew similarly to HTGC’s over the last 12 months.
ARCC's P/E Growth Rating (12) in the null industry is somewhat better than the same rating for HTGC (77). This means that ARCC’s stock grew somewhat faster than HTGC’s over the last 12 months.
| ARCC | HTGC | |
|---|---|---|
| RSI ODDS (%) | 3 days ago 50% | 3 days ago 87% |
| Stochastic ODDS (%) | 1 day ago 31% | 1 day ago 55% |
| Momentum ODDS (%) | 1 day ago 48% | 1 day ago 48% |
| MACD ODDS (%) | 1 day ago 43% | 1 day ago 68% |
| TrendWeek ODDS (%) | 1 day ago 41% | 1 day ago 47% |
| TrendMonth ODDS (%) | 1 day ago 39% | 1 day ago 46% |
| Advances ODDS (%) | 1 day ago 39% | 2 days ago 56% |
| Declines ODDS (%) | 6 days ago 40% | 6 days ago 50% |
| BollingerBands ODDS (%) | 1 day ago 18% | 1 day ago 47% |
| Aroon ODDS (%) | 1 day ago 34% | 1 day ago 43% |
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is overvalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
ARCC’s FA Score shows that 3 FA rating(s) are green while HTGC’s FA Score has 1 green FA rating(s).
- ARCC’s FA Score: 3 green, 2 red.
- HTGC’s FA Score: 1 green, 4 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
ARCC’s TA Score shows that 7 TA indicator(s) are bullish while HTGC’s TA Score has 5 bullish TA indicator(s).
- ARCC’s TA Score: 7 bullish, 3 bearish.
- HTGC’s TA Score: 5 bullish, 3 bearish.
Price Growth
ARCC (@Investment Managers) experienced а +2.26% price change this week, while HTGC (@Investment Managers) price change was +1.14% for the same time period.
The average weekly price growth across all stocks in the @Investment Managers industry was -2.64%. For the same industry, the average monthly price growth was -2.86%, and the average quarterly price growth was -1.76%.
Reported Earning Dates
ARCC is expected to report earnings on Feb 10, 2027.
HTGC is expected to report earnings on Feb 18, 2027.
Industries' Descriptions
@Investment Managers (-2.64% weekly)Investment Managers manage financial assets and other investments of clients. Management includes designing a short- or long-term strategy for buying/holding and selling of portfolio holdings. It can also include tax services and other aspects of financial planning as well. While it is perceived that the industry is faced with growing competition from robo-advisors/digital platforms and passive/ index-tracking funds, many investors still find value in actively managed in-person services that investment management companies often emphasize on. At the same time, many wealth managers are also incorporating digital initiatives/low cost options in addition to their in-person customized services. Their main sources of revenues are fees as a percentage of assets under management, in addition to a certain portion of clients’ gains from asset appreciation. BlackRock, Inc., Blackstone Group Inc and Brookfield Asset Management are some of the major investment management companies.
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ARCC and
Correlation & Price change
A.I.dvisor indicates that over the last year, ARCC has been closely correlated with OBDC. These tickers have moved in lockstep 80% of the time. This A.I.-generated data suggests there is a high statistical probability that if ARCC jumps, then OBDC could also see price increases.
| Ticker / NAME | Correlation To ARCC | 1D Price Change % | ||
|---|---|---|---|---|
| ARCC | 100% | +0.10% | ||
| OBDC - ARCC | 80% Closely correlated | N/A | ||
| GBDC - ARCC | 78% Closely correlated | -0.08% | ||
| BXSL - ARCC | 76% Closely correlated | -0.50% | ||
| MSDL - ARCC | 72% Closely correlated | -0.43% | ||
| NMFC - ARCC | 72% Closely correlated | -1.02% | ||
More | ||||
HTGC and
Correlation & Price change
A.I.dvisor indicates that over the last year, HTGC has been loosely correlated with OBDC. These tickers have moved in lockstep 66% of the time. This A.I.-generated data suggests there is some statistical probability that if HTGC jumps, then OBDC could also see price increases.
| Ticker / NAME | Correlation To HTGC | 1D Price Change % | ||
|---|---|---|---|---|
| HTGC | 100% | -0.43% | ||
| OBDC - HTGC | 66% Loosely correlated | N/A | ||
| ARCC - HTGC | 65% Loosely correlated | +0.10% | ||
| TSLX - HTGC | 64% Loosely correlated | -0.62% | ||
| PFLT - HTGC | 63% Loosely correlated | -0.73% | ||
| MAIN - HTGC | 62% Loosely correlated | -0.94% | ||
More | ||||
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