Bull Case

Private credit and asset-based finance demand stays elevated, allowing Ares to deploy capital at attractive spreads and lift fee-related earnings versus listed alternative managers.

Stable credit performance and disciplined underwriting limit realized losses, supporting carry income and NAV growth while peers with weaker vintages face more volatile marks.

Fundraising remains resilient across institutional and wealth channels, expanding fee-earning AUM and compounding management fees faster than smaller or less diversified peers.

Higher-rate refinancing and sponsor demand sustain transaction volume, enabling Ares to monetize origination scale and maintain stronger origination economics than many direct lenders.

Base Case

Ares continues to benefit from broad private credit penetration, but moderating deal activity and tighter spreads keep growth above peers yet below peak-cycle levels.

Credit losses remain manageable and fee-earning AUM grows steadily, preserving earnings resilience relative to smaller managers with less diversified capital sources.

Fundraising and deployment stay healthy but normalize from recent highs, producing mid-to-high single-digit earnings growth and stable margins versus public alternative peers.

Leverage and funding costs remain elevated, yet recurring fee income and asset management scale offset the drag better than at less diversified competitors.

Bear Case

A sharper slowdown in sponsor activity reduces deployment and origination fees, pressuring revenue growth more than at peers with larger permanent capital bases.

Credit deterioration in private loans and real estate exposures raises realized losses, compressing carry and NAV and exposing Ares to mark-to-market volatility.

Persistent funding-cost pressure and higher leverage constrain earnings conversion, leaving Ares less flexible than lower-levered alternative managers.

Fundraising slows as investors favor simpler or more liquid products, limiting fee-earning AUM growth and narrowing the gap versus diversified peers.

Overall Score

Ares’ forward outcomes are anchored by durable private credit demand and scale advantages, with leverage and funding costs limiting upside but not overwhelming the base case.