ARES · Ares Management
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $171.20
Note written ·
Price against the kill line
21.4% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
$171.20 ↑ kill line, off the scale above
Daily closes, to . The kill line, a daily close above $171.20, is too far above the closes to draw: well clear. The shares are down 3.8% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $171.20, the highest adjusted close of the past year (10 December 2025), which would show the shares leading the S&P 500. Third-quarter-beating management fee growth above 10% year over year at the next report would point the same way.
Research onlyNot in the portfolio.
Key figures from the filings · Financials
Quarter to 30 September 2026, filed 6 November 2026
- Revenue, latest quarter ($M)
- 1,258
- Revenue, change on a year (%)
- +9.1
- Operating margin (%)
- 22.6
All filed numbers
What Ares Management reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Operating margin (%) |
|---|---|---|---|
| first filed | 1,258 | +9.1 | 22.6 |
| first filed | 1,294 | +24.3 | 19.2 |
| first filed | 1,299 | +29.3 | 17.6 |
| first filed | 1,558 | +25.8 | 16.5 |
| first filed | 1,153 | +36.9 | 30.3 |
| first filed | 1,041 | +19.0 | 20.4 |
| Pre-tax income ($M) | 242 |
| Net income ($M) four quarters: 433 | 85.3 |
| Diluted shares, change on a year (%) | Not reported |
| Operating cash flow ($M) | −515 |
| Capital spending ($M) | Not reported |
| Free cash flow ($M) | Not available |
| Cash and short-term investments ($M) | 598 |
| Debt ($M) | Not available |
| Net cash, cash less debt ($M) | Not available |
| Deferred revenue ($M) | Not reported |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | Not reported |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 3,831 |
| Market value ($M) | Not available |
| Enterprise value, market value plus net debt ($M) | Not available |
| Enterprise value to sales (×) | Not available |
| Enterprise value to operating income (×) | Not available |
| Price to earnings (×) | Not available |
| Price to book value (×) | Not available |
| Free-cash-flow yield (%) | Not available |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): the share of shares outstanding is not available, 7.0 days of average trading to cover, +1.0% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $1.3M | $91.5M |
The thesis
Ares Management's fee earnings still rise, but the 29 October 2026 third-quarter report slowed fee growth and trimmed three 2026 targets. The shares are more likely to lag the S&P 500 over the next three months than to beat it. The fourth-quarter delivery of fund closes and lending deployment settles the call.
The shares closed at $137.89 on 11 November 2026, 23.9% below the quoted 52-week high of $181.19 (intraday, 10 December 2025). The 3-month price change is −6.8%. The close sits above the 50-day average of $124.69 and the 200-day average of $121.89 (adjusted daily closes).
The report was mixed. Fee-related earnings were $524.2 million, up from $491.1 million in the second quarter (company releases, 29 October 2026 and 31 July 2026). After-tax realized income was $1.26 per Class A share, against a $1.29 estimate in Benzinga's report. Benzinga put sales at $1.057 billion against a $1.272 billion estimate.
Post-report analyst targets run from $130 (Keefe, Bruyette & Woods) to $171 (RBC Capital Markets), and the shares closed within that range on 11 November 2026. Ares filed its quarterly report on Form 10-Q on 6 November 2026.
Bullish and bearish views on Ares Management Corporation
The bull case on Ares Management Corporation (ARES), in brief: record fundraising year is still expected. The bear case: fee growth is slowing.
Bull case
- Record fundraising year is still expected. Chief executive Michael Arougheti said on 29 October 2026 that Ares expects another record year. Over half of the more than $31 billion of third-quarter gross commitments came from outside the Credit Group (company release).
- Profit margin on fees widened. Earnings Whispers put the third-quarter fee-related earnings margin at 42.5%, up from 41.4% a year earlier. Total assets under management were about $691 billion at 30 September 2026 (Form 8-K).
- Deployment is large. Ares invested $35 billion across strategies in the third quarter (Form 8-K, 29 October 2026). Deals since then include the Infinity Transportation purchase at about $2.9 billion enterprise value (19 October 2026) and a €1.5 billion partnership with Norges Bank Investment Management (21 October 2026).
- Several targets rose after the report. On 30 October 2026 RBC raised its target to $171, Wells Fargo to $141 (Overweight), Barclays to $151 (Overweight) and Keefe, Bruyette & Woods to $130 (Market Perform). The shares have since closed above $139 on 9 November 2026 and 10 November 2026 (closes of $139.58 and $139.41).
Bear case
- Fee growth is slowing. Earnings Whispers reported that management fee growth fell to 10% year over year in the third quarter from 22% in the first. Fee-paying assets grew 13%, against 19% in the first quarter and 17% in the second.
- Management trimmed 2026 targets. Per Earnings Whispers, net realized performance income guidance fell to $300–325 million from about $350 million. Margin expansion was lowered to slightly above the midpoint of a 0–150 basis point range, and the wealth inflow outlook was cut to roughly $16 billion, in line with last year.
- Timing slipped on several fronts. The digital infrastructure fund's first close moved from summer to late in the fourth quarter. U.S. direct lending deployment stayed slow, and some European performance-fee timing slipped by a year or more (Earnings Whispers, 29 October 2026).
- Reported earnings fell. GAAP net income was $0.21 per common share in the third quarter, against $0.49 in the second (company releases). Revenue missed Benzinga's estimate for the second straight quarter.
- Some analysts cut targets. JPMorgan lowered its target to $154 and TD Cowen to $158 on 30 October 2026. Rothschild & Co Redburn's target is $129, up from $128 (2 November 2026).
Price setup
The shares closed at $137.89 on 11 November 2026, after closes of $139.58 on 9 November 2026 and $139.41 on 10 November 2026. The close of $133.72 on 5 November 2026 was the low of the past week's sessions.
The close is above the 50-day average of $124.69 and the 200-day average of $121.89 (adjusted daily closes, 11 November 2026). The quoted 52-week closing low is $96.50 (12 March 2026). The quoted 52-week high of $181.19 (intraday, 10 December 2025) is the ceiling the rebound has not approached.
The three-month change of −6.8% means the shares trail their level of 13 August 2026, when the close was $149.45 (quoted).
On 10 November 2026 Keefe, Bruyette & Woods adjusted its target again, and Ares's chief financial officer was named to present at the TD Cowen 2026 Financials & Fintech Conference (company news).
Catalysts ahead
- 17 December 2026: Record date for the $1.35 common dividend, payable 31 December 2026. Confirms the declared payout; it is the only confirmed dated event after the third-quarter report.
- ~31 December 2026 (est.): First close of the digital infrastructure fund and a pickup in U.S. direct lending deployment, which management moved into the fourth quarter. Delivery tests whether the trimmed 2026 targets were a timing delay or a lower run rate.
- ~February 2027 (est.): Fourth-quarter 2026 results. Shows whether management fee growth holds above the 10% rate of the third quarter and whether performance income reaches the $300-325 million guide.
What would change the view
A daily close above $171.20, the highest adjusted close of the past year (10 December 2025), which would show the shares leading the S&P 500. Third-quarter-beating management fee growth above 10% year over year at the next report would point the same way.
What it trades with
Ares trades with other listed alternative managers and business development companies. Sector headlines on redemption caps, such as Blue Owl limiting withdrawals from two funds on 2 October 2026 (Bloomberg), have moved the group together. Ares Capital Corporation and Ares Strategic Income Fund are separate vehicles whose results are not Ares Management earnings. MidCap Financial Investment Corporation cancelled its earnings call on 31 October 2026 because of its pending merger with Ares Capital.
The evidence, claim by claim (8)
- Third-quarter 2026 fee-related earnings were $524.2 million; after-tax realized income was $1.26 per Class A share; GAAP net income was $0.21 per common share. Ares Management Form 8-K earnings release · as of
- Total assets under management were about $691 billion at 30 September 2026, with $35 billion invested in the quarter and more than $31 billion of gross commitments. Ares Management Form 8-K earnings release · as of
- Ares declared a $1.35 common dividend, record date 17 December 2026, payable 31 December 2026. Ares Management Form 8-K earnings release · as of
- Management fee growth slowed to 10% year over year from 22% in the first quarter; fee-paying assets grew 13%. Earnings Whispers via Finviz · as of
- Net realized performance income guidance was cut to $300-325 million from about $350 million; wealth inflow outlook was cut to roughly $16 billion. Earnings Whispers via Finviz · as of
- Adjusted EPS of $1.26 missed a $1.29 estimate and sales of $1.057 billion missed a $1.272 billion estimate. Benzinga earnings report · as of
- RBC raised its target to $171, Wells Fargo to $141, Barclays to $151 and KBW to $130; JPMorgan lowered to $154 and TD Cowen to $158. Benzinga analyst-action reports · as of
- Ares filed its quarterly report on Form 10-Q with the SEC. SEC Form 10-Q filing · as of
Sources
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