Morgan Stanley Direct Lending Fund (NYSE:MSDL) Receives Consensus Recommendation of "Hold" from Analysts

Key Points

• Consensus "Hold": Seven analysts cover MSDL (six holds, one buy) with an average 1‑year target of $15.58, and several firms have recently trimmed their price targets, reflecting neutral sentiment.
• Dividend and payout concerns: The fund declared a $0.45 quarterly dividend ($1.80 annualized) for a 12.7% yield, but the payout ratio is an elevated 128.57%, raising sustainability questions.
• Insiders buying shares: CEO Michael Jr. Occi bought 7,000 shares and another insider purchased 5,000 shares in March, increasing their positions despite the market's cautious outlook.

Morgan Stanley Direct Lending Fund (NYSE:MSDL - Get Free Report) has received an average recommendation of "Hold" from the seven brokerages that are presently covering the firm, Marketbeat reports. Six research analysts have rated the stock with a hold rating and one has assigned a buy rating to the company. The average 1 year target price among analysts that have covered the stock in the last year is $15.5833.

Several research analysts have recently weighed in on MSDL shares. Keefe, Bruyette & Woods dropped their target price on shares of Morgan Stanley Direct Lending Fund from $18.50 to $16.50 and set a "market perform" rating on the stock in a research report on Monday, March 2nd. Wells Fargo & Company dropped their target price on shares of Morgan Stanley Direct Lending Fund from $16.00 to $14.00 and set an "equal weight" rating on the stock in a research report on Monday, March 2nd. UBS Group dropped their target price on shares of Morgan Stanley Direct Lending Fund from $18.00 to $16.00 and set a "neutral" rating on the stock in a research report on Friday, March 13th. Raymond James Financial reissued an "outperform" rating and issued a $17.00 target price on shares of Morgan Stanley Direct Lending Fund in a research report on Thursday, March 5th. Finally, Royal Bank Of Canada dropped their target price on shares of Morgan Stanley Direct Lending Fund from $18.00 to $16.00 and set a "sector perform" rating on the stock in a research report on Thursday, March 5th.

Morgan Stanley Direct Lending Fund Stock Down 0.5%

NYSE MSDL opened at $14.23 on Wednesday. The company has a debt-to-equity ratio of 1.19, a current ratio of 1.59 and a quick ratio of 1.59. The company's 50 day simple moving average is $14.99 and its 200 day simple moving average is $16.18. Morgan Stanley Direct Lending Fund has a 12 month low of $13.66 and a 12 month high of $20.00. The company has a market capitalization of $1.22 billion, a P/E ratio of 10.16 and a beta of 0.35.

Morgan Stanley Direct Lending Fund (NYSE:MSDL - Get Free Report) last released its earnings results on Thursday, February 26th. The company reported $0.49 earnings per share for the quarter, hitting the consensus estimate of $0.49. The business had revenue of $49.57 million for the quarter, compared to the consensus estimate of $97.30 million. Morgan Stanley Direct Lending Fund had a net margin of 30.73% and a return on equity of 9.88%. Equities research analysts expect that Morgan Stanley Direct Lending Fund will post 2.56 earnings per share for the current fiscal year.

Morgan Stanley Direct Lending Fund Cuts Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Friday, April 24th. Investors of record on Tuesday, March 31st will be given a dividend of $0.45 per share. The ex-dividend date of this dividend is Tuesday, March 31st. This represents a $1.80 dividend on an annualized basis and a yield of 12.7%. Morgan Stanley Direct Lending Fund's payout ratio is presently 128.57%.

Insider Buying and Selling

In related news, CEO Michael Jr. Occi acquired 7,000 shares of the stock in a transaction that occurred on Monday, March 2nd. The shares were purchased at an average cost of $14.87 per share, with a total value of $104,090.00. Following the completion of the transaction, the chief executive officer owned 28,500 shares of the company's stock, valued at approximately $423,795. This trade represents a 32.56% increase in their position. The purchase was disclosed in a filing with the SEC, which can be accessed through this link. Also, insider Jeff M. Day acquired 5,000 shares of the stock in a transaction that occurred on Thursday, March 5th. The shares were bought at an average cost of $14.89 per share, for a total transaction of $74,450.00. Following the completion of the transaction, the insider directly owned 22,818 shares of the company's stock, valued at $339,760.02. This represents a 28.06% increase in their position. Additional details regarding this purchase are available in the official SEC disclosure. Insiders own 0.21% of the company's stock.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in MSDL. Bartlett & CO. Wealth Management LLC purchased a new position in Morgan Stanley Direct Lending Fund during the third quarter valued at approximately $30,000. NewEdge Advisors LLC acquired a new stake in Morgan Stanley Direct Lending Fund in the third quarter valued at approximately $32,000. SHP Wealth Management acquired a new stake in Morgan Stanley Direct Lending Fund in the fourth quarter valued at approximately $39,000. DV Equities LLC acquired a new stake in Morgan Stanley Direct Lending Fund in the fourth quarter valued at approximately $41,000. Finally, Ameritas Advisory Services LLC lifted its stake in Morgan Stanley Direct Lending Fund by 53.3% in the third quarter. Ameritas Advisory Services LLC now owns 3,388 shares of the company's stock valued at $54,000 after acquiring an additional 1,178 shares during the last quarter.

About Morgan Stanley Direct Lending Fund

Morgan Stanley Direct Lending Fund NYSE: MSDL is a closed-end management investment company that seeks to provide investors with attractive current income and the potential for capital appreciation. The fund primarily invests in senior secured loans and other debt instruments issued by middle-market companies. By focusing on floating-rate structures, it aims to offer a measure of protection against rising interest rates while generating regular cash distributions.

The fund's investment strategy centers on building a diversified portfolio of direct lending opportunities across a broad range of industries, including healthcare, business services, and industrials.

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