Head-To-Head Review: Morgan Stanley Direct Lending (MSDL) and Its Competitors

Morgan Stanley Direct Lending (NYSE:MSDL) is one of 654 public companies in the “Holding & other investment offices” industry, but how does it compare to its peers? We will compare Morgan Stanley Direct Lending to related companies based on the strength of its earnings, valuation, dividends, institutional ownership, profitability, risk and analyst recommendations.

Profitability

This table compares Morgan Stanley Direct Lending and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Morgan Stanley Direct Lending	62.81%	11.51%	5.99%
Morgan Stanley Direct Lending Competitors	5.40%	-54.27%	2.53%

Institutional and Insider Ownership

54.0% of shares of all “Holding & other investment offices” companies are owned by institutional investors. 25.5% of shares of all “Holding & other investment offices” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Morgan Stanley Direct Lending and its peers revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Morgan Stanley Direct Lending	$367.74 million	$231.01 million	6.78
Morgan Stanley Direct Lending Competitors	$1.27 billion	-$77.20 million	53.76

Morgan Stanley Direct Lending’s peers have higher revenue, but lower earnings than Morgan Stanley Direct Lending. Morgan Stanley Direct Lending is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Dividends

Morgan Stanley Direct Lending pays an annual dividend of $2.00 per share and has a dividend yield of 9.4%. Morgan Stanley Direct Lending pays out 63.9% of its earnings in the form of a dividend. As a group, “Holding & other investment offices” companies pay a dividend yield of 6.8% and pay out 63.9% of their earnings in the form of a dividend. Morgan Stanley Direct Lending is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of current ratings and target prices for Morgan Stanley Direct Lending and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Morgan Stanley Direct Lending	0	3	3	0	2.50
Morgan Stanley Direct Lending Competitors	121	549	836	14	2.49

Morgan Stanley Direct Lending presently has a consensus price target of $21.58, suggesting a potential upside of 1.76%. As a group, “Holding & other investment offices” companies have a potential upside of 149.39%. Given Morgan Stanley Direct Lending’s peers higher possible upside, analysts clearly believe Morgan Stanley Direct Lending has less favorable growth aspects than its peers.

Morgan Stanley Direct Lending 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.