Ares Capital (ARCC) Stock

There are many ways to earn passive income, possibly more than you can imagine. However, this saying might not hold true based on how much effort you're willing to put in. Your level of commitment can really make a difference.

Ares Capital (ARCC) has recently caught the attention of Zacks.com users. Therefore, it's important to look into what the future holds for this stock.

Although stock returns have been impressive, new investors looking for passive income have discovered that dividend yields decrease when stock prices increase. Most S&P 500 stocks do not offer attractive dividend yields, but some business development companies (BDCs) are worth considering for those seeking income. Ares Capital (NASDAQ: ARCC), PennantPark Floating Rate Capital (NYSE: PFLT), and Hercules Capital (NYSE: HTGC) currently provide an average yield of 9.9% based on recent prices.

Investors in U.S. stocks have had a fantastic time over the past few years. From the end of 2022 to December 27, the S&P 500 index increased by 55.5%.

Risk refers to the chance of a harmful event happening in the future. It is an idea that cannot be measured directly; if it could, it wouldn't be considered risk. To manage risk effectively, the first step is to determine its value, which helps in minimizing unexpected losses. I choose to invest in securities that have shown positive NAV performance over time as a strategy to manage risk.

I really like the term "ultra-high-yield dividend stocks." By investing in stocks, I can have a share in successful companies.

Investors are particularly fond of dividend stocks, especially those with high yields, as they provide a substantial income and have great potential for overall returns.

Market fluctuations create chances for value investors, and companies like Blue Owl Capital Corp. and W.P. Carey offer attractive yields and reliable income. OBDC boasts a 10.9% annual dividend yield, a diverse portfolio, and careful financial management, making it a great option for those seeking income. Meanwhile, WPC provides a 6.5% yield backed by essential real estate, long-term leases, and rent increases that can withstand inflation, ensuring consistent income and growth.

In the last three years, Ares Capital's (ARCC 0.36%) stock has increased by around 6%. While this growth may appear modest, the total return, which includes reinvested dividends, is actually much higher at 42%.