ARES vs STEP

Key Takeaways

• ARES has outperformed STEP in recent weeks, gaining approximately 5.6% from late March levels amid volatility, while STEP has traded relatively flat.
• Year-to-date (YTD), ARES leads with a 29.7% return compared to STEP's 21.7% gain, reflecting stronger market positioning.
• ARES boasts a higher dividend yield of 4.8% versus STEP's 2.9%, appealing to income-focused investors.
• ARES reports positive earnings per share (EPS, a measure of profitability per share) of $1.71, contrasting with STEP's negative EPS of -$6.92.
• Tickeron's analysis rates both as StrongBuy but favors ARES short-term and STEP long-term based on technical and fundamental scores.
• Both firms operate in alternative investments, but ARES's diversification across credit and private equity provides broader exposure than STEP's private markets focus.

Introduction

In the evolving landscape of alternative investments, ARES and STEP stand out as key players offering exposure to private credit, equity, and real assets. This stock comparison analyzes their business models, recent performance, and market dynamics, aiding traders seeking momentum plays and long-term investors eyeing growth in non-traditional assets. With private markets gaining traction amid interest rate shifts and economic uncertainty, understanding relative performance helps evaluate sector positioning and potential trade-offs in risk and reward.

ARES Overview and Recent Performance

Ares Management Corporation (ARES) is a leading alternative asset manager with over $400 billion in assets under management (AUM, total value of assets managed), spanning direct lending to middle-market companies, private equity, and real estate investments. In recent market activity, ARES shares have shown resilience, climbing about 5.6% from late March closes around $106 to $112 as of late April, after dipping to $96 mid-March. This recovery reflects positive sentiment around its diversified revenue streams, particularly in private credit, bolstered by upcoming earnings and involvement in high-profile deals like financing for acquisitions. Trading near the middle of its 52-week range ($96-$195), with a market cap of $25.3 billion, ARES benefits from a robust 4.8% dividend yield and a price-to-earnings (P/E, valuation relative to earnings) ratio of 65.6.

STEP Overview and Recent Performance

StepStone Group Inc. (STEP) specializes in private equity and venture capital, focusing on fund-of-funds, secondaries, and direct investments across global markets. Recent weeks have seen STEP shares fluctuate between $46 and $56, ending late April near $50 after peaking mid-month, marking a modest gain from late March levels around $48. Performance has been influenced by broader private markets sentiment and a $100 million stock repurchase program, though negative EPS highlights profitability challenges. With a $6.2 billion market cap and 52-week range of $41-$78, STEP offers a 2.9% dividend yield but trades without a P/E due to losses, positioning it as a growth-oriented play in a volatile sector.

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Head-to-Head Comparison

ARES and STEP both thrive in alternative investments but differ in scope: ARES’s broader model includes direct lending and real estate for stable fee income, while STEP emphasizes fund-of-funds and secondaries for private market alpha. Growth drivers favor ARES with positive EPS and higher AUM scale, versus STEP’s focus on emerging opportunities amid profitability hurdles. Recent momentum tilts to ARES, with steadier uptrend versus STEP’s sharper swings. Risk factors include sector sensitivity to rates for both, but STEP faces higher volatility (beta 1.31 implied). Market sentiment supports ARES’s dividend appeal over STEP’s growth trade-offs.

Tickeron AI Verdict

Tickeron’s AI currently favors ARES in the short term due to superior technical scores (5 bullish vs. STEP’s 5), consistent recent uptrend, and stronger stability from positive earnings and diversification. STEP holds long-term potential via fundamental positioning in private markets, but ARES aligns better with observable momentum and catalysts like earnings proximity.

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. Disclaimers and Limitations