ARES Should I Buy
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Ares Management Corp (ARES) is not a strong buy at the moment for a beginner investor with a long-term strategy. The technical indicators are bearish, options data suggests bearish sentiment, and the financial performance shows significant declines in net income and EPS despite revenue growth. While analysts maintain generally positive ratings, the stock's recent underperformance and lack of immediate positive catalysts make it a hold rather than a buy for now.
The technical indicators for ARES are bearish. The MACD histogram is negative and contracting, the RSI is neutral at 39.279, and the moving averages indicate a bearish trend (SMA_200 > SMA_20 > SMA_5). The stock is trading below the pivot level of 135.958, with key support at 123.433 and resistance at 148.484.
Analysts maintain generally positive ratings, with several firms highlighting Ares' strong track record in credit underwriting and durable fee-related earnings growth. The company anticipates robust fundraising in 2026 and has a record-level investment pipeline, which could drive future growth.
The private credit market faces renewed uncertainty due to AI pressures on software companies, which could impact Ares' credit funds. The company's Q4 results missed expectations, leading to an 8.4% drop in share price. Additionally, the broader alternative asset management sector has seen significant sell-offs.
In Q4 2025, revenue increased by 27.68% YoY to $1.77 billion, but net income dropped by 80.24% YoY to $28.94 million, and EPS fell by 81.94% YoY to $0.13. This indicates strong top-line growth but significant bottom-line challenges.
Analysts are generally positive on ARES, with multiple Buy and Outperform ratings. However, recent price target revisions have been mixed, with some firms lowering targets due to broader market concerns. The average price target remains significantly above the current price, suggesting potential upside in the long term.
