This 10%-Yielding Dividend Stock is Coming Off a Record Year With Lots Of Momentum in 2026

Ares Capital (NASDAQ: ARCC) precocious closed the books connected 2025 by reporting its fourth-quarter and full-year fiscal results. It was a beardown twelvemonth for the concern improvement institution (BDC), capped by a grounds level of caller concern commitments. They added caller unchangeable sources of income to enactment its 10%-yielding dividend.

The BDC has present paid a unchangeable oregon increasing dividend for 16 consecutive years. It's in a coagulated position to proceed paying a bankable dividend, making it a compelling income banal to buy.

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Ares Capital generated $0.50 per stock of halfway net during the 4th quarter, which much than covered its $0.48 per stock quarterly dividend. That continued the BDC's inclination of delivering halfway net exceeding its dividend payments. For the year, Ares Capital reported $2.01 per stock of halfway earnings, which much than covered the $1.92 per stock successful dividends it paid.

The specialty concern institution besides had a beardown twelvemonth successful securing caller indebtedness investments. Ares Capital made $5.8 cardinal successful caller concern commitments successful the 4th fourth crossed 30 caller portfolio companies and 84 existing ones, 80% of which were first-lien, senior-secured loans. That much than offset the $4.7 cardinal of concern commitments it exited during the period. For the year, the BDC made a grounds $15.8 cardinal of gross commitments portion exiting $12.1 cardinal of investments.

Ares Capital ended the twelvemonth with an industry-leading concern portfolio valued astatine $29.5 cardinal crossed 602 portfolio companies. That's up from $26.7 cardinal invested crossed 550 companies astatine the extremity of 2024.

The institution enhanced its already beardown equilibrium expanse past year. It added a grounds $4.5 cardinal successful caller indebtedness commitments, portion maintaining ample liquidity to enactment caller investments.

Ares Capital is disconnected to a beardown commencement successful securing caller investments this year. It made $1.4 cardinal successful caller concern commitments done precocious January, portion exiting $709 cardinal successful commitments. Meanwhile, the institution had different $2.2 cardinal of imaginable investments successful its backlog adjacent the extremity of January.

These caller investments volition assistance enactment the company's dividend payment. Ares besides estimates that it volition transportation guardant $1.38 per stock of excess taxable income from past twelvemonth for organisation successful 2026. It provides immoderate further cushion for its dividend should halfway net dip beneath the dividend level.