Morgan Stanley Direct Lending Fund (NYSE:MSDL) Sets New 12-Month Low - Should You Sell?

Key Points

• The Morgan Stanley Direct Lending Fund (NYSE:MSDL) recently hit a new 52-week low at $16.74, following a decline in share price and a downgrade from Zacks Research to a "strong sell" rating.
• The fund's quarterly earnings report showed a miss in expected earnings per share, with actual earnings of $0.50 compared to the consensus estimate of $0.52.
• The company declared a quarterly dividend of $0.50, set to be paid on October 24th, which translates to a 12.0% annualized yield, but noted a payout ratio of 103.63%.

Morgan Stanley Direct Lending Fund (NYSE:MSDL - Get Free Report)'s share price reached a new 52-week low during trading on Monday . The stock traded as low as $16.80 and last traded at $16.74, with a volume of 60720 shares traded. The stock had previously closed at $16.88.

Wall Street Analysts Forecast Growth

Several equities research analysts have commented on MSDL shares. Zacks Research lowered Morgan Stanley Direct Lending Fund from a "hold" rating to a "strong sell" rating in a research report on Friday, August 22nd. Wells Fargo & Company reduced their target price on Morgan Stanley Direct Lending Fund from $19.00 to $17.00 and set an "equal weight" rating for the company in a research note on Thursday, August 14th. UBS Group upped their target price on Morgan Stanley Direct Lending Fund from $20.50 to $21.00 and gave the stock a "neutral" rating in a research note on Wednesday, July 16th. Finally, Royal Bank Of Canada reduced their target price on Morgan Stanley Direct Lending Fund from $21.00 to $19.00 and set an "outperform" rating for the company in a research note on Wednesday, September 10th. One equities research analyst has rated the stock with a Buy rating, four have assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of "Hold" and a consensus price target of $19.30.

Morgan Stanley Direct Lending Fund Stock Down 1.2%

The company has a debt-to-equity ratio of 1.15, a quick ratio of 1.19 and a current ratio of 1.19. The company has a market cap of $1.45 billion, a price-to-earnings ratio of 8.64 and a beta of 0.33. The business has a 50-day simple moving average of $18.05 and a 200-day simple moving average of $18.96.

Morgan Stanley Direct Lending Fund (NYSE:MSDL - Get Free Report) last issued its earnings results on Thursday, August 7th. The company reported $0.50 earnings per share for the quarter, missing the consensus estimate of $0.52 by ($0.02). Morgan Stanley Direct Lending Fund had a return on equity of 11.24% and a net margin of 42.65%.The business had revenue of $99.51 million for the quarter, compared to analyst estimates of $99.99 million. On average, equities analysts anticipate that Morgan Stanley Direct Lending Fund will post 2.56 earnings per share for the current fiscal year.

Morgan Stanley Direct Lending Fund Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Friday, October 24th. Investors of record on Tuesday, September 30th will be paid a $0.50 dividend. The ex-dividend date is Tuesday, September 30th. This represents a $2.00 dividend on an annualized basis and a dividend yield of 12.0%. Morgan Stanley Direct Lending Fund's payout ratio is 103.63%.

Insiders Place Their Bets

In related news, Director Joan Binstock purchased 5,659 shares of the business's stock in a transaction dated Monday, August 11th. The stock was bought at an average cost of $17.68 per share, with a total value of $100,051.12. Following the completion of the acquisition, the director directly owned 39,251 shares in the company, valued at $693,957.68. The trade was a 16.85% increase in their position. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. Also, CEO Michael Jr. Occi bought 14,000 shares of the company's stock in a transaction that occurred on Tuesday, August 12th. The stock was acquired at an average price of $17.78 per share, with a total value of $248,920.00. Following the completion of the purchase, the chief executive officer directly owned 21,500 shares of the company's stock, valued at approximately $382,270. The trade was a 186.67% increase in their position. The disclosure for this purchase can be found here. Insiders have bought 57,907 shares of company stock valued at $1,025,013 in the last three months. 0.21% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Morgan Stanley Direct Lending Fund

A number of institutional investors have recently added to or reduced their stakes in MSDL. Ameritas Advisory Services LLC purchased a new stake in Morgan Stanley Direct Lending Fund during the second quarter valued at about $41,000. Allworth Financial LP boosted its position in shares of Morgan Stanley Direct Lending Fund by 62.3% in the second quarter. Allworth Financial LP now owns 2,606 shares of the company's stock worth $49,000 after buying an additional 1,000 shares during the period. Steward Partners Investment Advisory LLC boosted its holdings in Morgan Stanley Direct Lending Fund by 225.0% in the second quarter. Steward Partners Investment Advisory LLC now owns 3,250 shares of the company's stock valued at $61,000 after purchasing an additional 2,250 shares during the last quarter. AdvisorNet Financial Inc purchased a new position in Morgan Stanley Direct Lending Fund in the first quarter valued at about $66,000. Finally, Creative Financial Designs Inc. ADV purchased a new position in Morgan Stanley Direct Lending Fund in the first quarter valued at about $71,000.

Morgan Stanley Direct Lending Fund Company Profile

Morgan Stanley Direct Lending Fund is a business development company. It is a non-diversified, externally managed specialty finance company focused on lending to middle-market companies. Morgan Stanley Direct Lending Fund is based in NEW YORK.

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