Hercules Capital Outperforms Ares Capital in Key Metrics

Analysts see greater upside potential in Hercules Capital stock compared to Ares Capital

Published on Feb. 22, 2026

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Ares Capital (NASDAQ:ARCC) and Hercules Capital (NYSE:HTGC) are both finance companies, but a comparison of the two reveals that Hercules Capital outperforms Ares Capital on several key metrics, including consensus price target, dividend yield, and valuation. Analysts believe Hercules Capital has stronger growth prospects and is the more favorable investment.

Why it matters

The comparison between these two finance companies is relevant for investors looking to allocate capital in the sector. Hercules Capital's stronger fundamentals and analyst sentiment suggest it may be the better long-term investment option compared to Ares Capital.

The details

Hercules Capital has a higher consensus price target of $19.29, indicating a potential upside of 24.99% compared to Ares Capital's price target of $22.00 and 14.88% upside. Hercules Capital also has a higher dividend yield of 10.4% versus Ares Capital's 10.0%. Additionally, Hercules Capital is trading at a lower price-to-earnings ratio, making it the more affordable of the two stocks. Hercules Capital beats Ares Capital on 12 of the 18 factors compared between the two companies.

  • Ares Capital and Hercules Capital are both publicly traded finance companies.

The players

Ares Capital Corporation

A business development company specializing in acquisition, recapitalization, mezzanine debt, restructurings, rescue financing, and leveraged buyout transactions of middle market companies.

Hercules Capital, Inc.

A business development company that provides venture debt, debt, senior secured loans, and growth capital to privately held venture capital-backed companies at all stages of development.

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The takeaway

For investors seeking exposure to the finance sector, Hercules Capital appears to be the more attractive option compared to Ares Capital based on its stronger fundamentals, higher dividend yield, and greater analyst confidence in its growth potential.