Morgan Stanley Direct Lending Fund's (MSDL) ability to leverage Morgan Stanley's network for a potentially differentiated origination or sourcing funnel is likeable, RBC Capital Markets said in a Thursday research report.
The company continued to ramp up its Capstone joint venture, expected to generate a roughly 13% dividend yield at the company level once fully ramped, but management hinted that the timeframe for the ramp will depend on investment opportunities, analysts wrote.
The ongoing JV ramp could boost the company's return on equity, with potential risks manageable, given limited portfolio allocation, according to the note.
The brokerage said it maintained its sector perform rating on the stock and price target of $16 per share.
Price: $15.45, Change: $-0.13, Percent Change: -0.80%