Morgan Stanley Direct Lending Fund (MSDL) AI Stock Analysis

• Market Cap: $1.49B
• Dividend Yield: 12.09%
• Average Volume (3M): 928.77K
• Price to Earnings (P/E): 8.9
• Beta (1Y): 0.52
• Revenue Growth: 2.70%
• EPS Growth: -35.08%
• Country: US
• Employees: N/A
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Conglomerates
• EPS (TTM): 0.50
• Shares Outstanding: 86,835,014
• 10 Day Avg. Volume: 855,410
• 30 Day Avg. Volume: 928,770
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 2.42
• Enterprise Value/Revenue: 10.38
• Enterprise Value/Gross Profit: 12.35
• Enterprise Value/Ebitda: 11.16
• 1Y Price Target: $17.83
• Price Target Upside: 3.97% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 80 Outperform
• Price Target: $19.50 ▲(13.70% Upside)

Morgan Stanley Direct Lending Fund scores well due to its strong financial performance, attractive valuation, and strategic management highlighted in the earnings call. However, technical indicators suggest potential resistance, and recent cash flow challenges indicate areas for improvement.

Positive Factors

Strong Financial Position

MSDL's zero-debt status highlights exceptional financial stability, providing flexibility to navigate market fluctuations and invest in growth opportunities.

Revenue Growth

Significant revenue growth over the years indicates strong market demand and effective business strategies, supporting long-term profitability.

Diverse Portfolio

A diversified portfolio reduces risk and enhances stability, ensuring consistent returns and resilience against market volatility.

Negative Factors

Cash Flow Challenges

Negative free cash flow indicates potential liquidity issues, which could limit MSDL's ability to fund operations and growth initiatives.

Volatile EBIT Margins

Volatile EBIT margins suggest operational inefficiencies, potentially affecting profitability and requiring strategic adjustments to improve.

Spread Compression

Spread compression reduces income potential from investments, impacting overall returns and necessitating strategic adaptation to maintain profitability.

Morgan Stanley Direct Lending Fund Business Overview & Revenue Model

Company Description

Morgan Stanley Direct Lending Fund is a business development and finance company, which engages in lending to middle-market companies. It invests in directly originated senior secured term loans including first lien senior secured term loans and second lien senior secured term loans. The company was founded on May 30, 2019 and is headquartered in New York, NY.

How the Company Makes Money

MSDL generates revenue primarily through interest income from the loans it provides to borrowers. This interest income is derived from the interest and fees charged on the loans, which are structured to reflect the credit risk and market conditions. Additionally, MSDL may earn management fees from investors for managing the fund's assets, as well as potential performance fees based on the fund's returns exceeding certain benchmarks. Key partnerships with financial institutions and access to a broad network of borrowers enhance MSDL's ability to source attractive lending opportunities and improve its overall earnings potential.

Morgan Stanley Direct Lending Fund Financial Statement Overview

Summary

Morgan Stanley Direct Lending Fund demonstrates strong revenue growth and a robust balance sheet with zero debt, indicating financial stability. However, challenges in cash flow and volatile EBIT margins suggest areas for improvement in operational efficiency.

Income Statement

Morgan Stanley Direct Lending Fund has shown robust growth in total revenue over the years, with a significant increase from $24 million in 2020 to $253 million in 2024. The net profit margin has also remained strong, with net income consistently climbing, indicating effective cost management and profitability. However, the EBIT and EBITDA margins have been volatile, with EBIT at zero in 2024, which could indicate challenges in operational efficiency.

Balance Sheet

The company maintains a strong financial position with zero total debt in 2024, indicating exceptional financial stability. The equity ratio remains solid, suggesting prudent financial management. However, the return on equity has been fluctuating, reflecting variable profitability relative to shareholder equity.

Cash Flow

The cash flow statement shows mixed results. While the company has maintained positive free cash flow in previous years, 2024 saw a significant negative free cash flow, pointing to potential liquidity issues. The operating cash flow to net income ratio has also been negative recently, indicating discrepancies between earnings and cash generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	347.24M	253.06M	366.34M	230.80M	98.62M	24.06M
Gross Profit	291.77M	253.06M	316.51M	199.92M	100.50M	19.64M
EBITDA	322.97M	338.59M	343.90M	217.66M	104.27M	22.02M
Net Income	194.92M	215.56M	231.01M	48.54M	83.25M	18.30M
Balance Sheet
Total Assets	3.92B	3.91B	3.31B	2.99B	2.49B	656.81M
Cash, Cash Equivalents and Short-Term Investments	52.22M	72.37M	69.70M	81.22M	74.15M	11.26M
Total Debt	2.05B	1.97B	1.50B	1.52B	1.25B	333.85M
Total Liabilities	2.13B	2.07B	1.59B	1.59B	1.30B	355.19M
Stockholders Equity	1.79B	1.84B	1.72B	1.40B	1.19B	301.62M
Cash Flow
Free Cash Flow	-138.31M	-373.54M	185.78M	121.59M	67.69M	12.43M
Operating Cash Flow	-138.31M	-373.54M	185.78M	121.59M	67.69M	12.43M
Investing Cash Flow	1.66M	-575.01M	-269.60M	-551.43M	-1.73B	-625.78M
Financing Cash Flow	121.23M	376.19M	72.31M	436.90M	1.72B	624.58M

Morgan Stanley Direct Lending Fund Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 17.15
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MSDL, the sentiment is Neutral. The current price of 17.15 is above the 20-day moving average (MA) of 16.68, above the 50-day MA of 16.92, and below the 200-day MA of 18.16, indicating a neutral trend. The MACD of 0.09 indicates Negative momentum. The RSI at 61.78 is Neutral, neither overbought nor oversold. The STOCH value of 84.06 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for MSDL.

Morgan Stanley Direct Lending Fund Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MSDL	―	$1.49B	8.89	9.34%	12.09%	2.70%	-35.08%
NCDL	―	$707.72M	7.84	10.37%	13.74%	13.19%	-18.24%
Sector *	―	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
AUNA	―	$455.92M	6.99	15.04%	―	2.83%	―
PSBD	―	$399.64M	22.15	3.46%	13.73%	0.36%	-80.23%
PACS	―	$1.90B	―	―	―	―	―

Morgan Stanley Direct Lending Fund Corporate Events

Morgan Stanley Direct Lending Fund Q3 Results Announcement

On October 6, 2025, Morgan Stanley Direct Lending Fund announced that it will release its financial results for the third quarter of 2025 on November 6, 2025, after the market closes. The company will hold an earnings call on November 7, 2025, to discuss these results, potentially impacting stakeholders by providing insights into its financial health and market position.

The most recent analyst rating on (MSDL) stock is a Buy with a $17.00 price target. To see the full list of analyst forecasts on Morgan Stanley Direct Lending Fund stock, see the MSDL Stock Forecast page.

Morgan Stanley DLF Amends Credit Agreement with BNP

On September 24, 2025, DLF Financing SPV LLC, a subsidiary of Morgan Stanley Direct Lending Fund, amended its Revolving Credit and Security Agreement with BNP Paribas, reducing applicable margins during and after the reinvestment period. This adjustment in the BNP Funding Facility aims to optimize borrowing costs and aligns with the company’s strategic financial management, potentially enhancing its competitive position in the direct lending market.

The most recent analyst rating on (MSDL) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on Morgan Stanley Direct Lending Fund stock, see the MSDL Stock Forecast page.

Morgan Stanley Completes $401.2 Million Debt Securitization

On September 17, 2025, North Haven Private Credit CLO 1 LLC, a subsidiary of Morgan Stanley Direct Lending Fund, completed a $401.2 million term debt securitization. This securitization, backed by a diversified portfolio of senior secured and second lien loans, allows the company to maintain initial leverage through October 2029 and involves the sale of ownership interests to the 2025 Issuer. The secured notes mature in 2037, while the subordinated notes are due in 2125.

The most recent analyst rating on (MSDL) stock is a Hold with a $17.00 price target. To see the full list of analyst forecasts on Morgan Stanley Direct Lending Fund stock, see the MSDL Stock Forecast page.

Morgan Stanley Direct Lending Fund Balances Growth and Challenges in Latest Earnings Call

The recent earnings call for Morgan Stanley Direct Lending Fund (MSDL) painted a picture of balanced sentiment, reflecting both promising developments and notable challenges. The company reported solid net investment income and successful debt refinancing, alongside a diversified high-quality portfolio. However, these achievements were tempered by a slight decline in investment income, new nonaccruals, and spread compression, resulting in an overall balanced outlook.

Morgan Stanley Direct Lending Fund Declares Distribution

On August 5, 2025, Morgan Stanley Direct Lending Fund declared a regular distribution of $0.50 per share, payable on October 24, 2025. The company reported its financial results for the second quarter ending June 30, 2025, with net investment income of $43.7 million and a net asset value of $20.59 per share. The company also announced the successful pricing of $350 million in notes due May 2030, replacing $275 million in notes due September 2025. These financial maneuvers reflect the company’s strategic efforts to manage its debt and enhance shareholder value.

The most recent analyst rating on (MSDL) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on Morgan Stanley Direct Lending Fund stock, see the MSDL Stock Forecast page.

Morgan Stanley Sets Pricing for $401.2M CLO Transaction

On August 6, 2025, North Haven Private Credit CLO 1 LLC, a subsidiary of Morgan Stanley Direct Lending Fund, set pricing terms for a collateralized loan obligation (CLO) transaction, expecting to issue approximately $401.2 million in notes. This transaction, anticipated to close on September 17, 2025, is a secured financing move by the company, consolidating its asset coverage under the Investment Company Act of 1940, and highlights its strategic positioning in the credit market.

The most recent analyst rating on (MSDL) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on Morgan Stanley Direct Lending Fund stock, see the MSDL Stock Forecast page.

Morgan Stanley Direct Lending Fund Announces Leadership Changes

On July 23, 2025, Jeffrey Levin announced his resignation as CEO and Director of Morgan Stanley Direct Lending Fund, effective around July 25, 2025. The board appointed Michael Occi as the new CEO and Director, Ashwin Krishnan as Chief Investment Officer, and Orit Mizrachi and Jeffrey Day as Co-Presidents, effective around the same date. These leadership changes are not due to any disagreements and aim to ensure a smooth transition and continued strategic focus for the company.

The most recent analyst rating on (MSDL) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on Morgan Stanley Direct Lending Fund stock, see the MSDL Stock Forecast page.