Morgan Stanley Direct Lending: 10% Dividend Reset

The Asian Investor31.58K FollowersFollow5ShareSavePlay(9min)Comment(1)SummaryMorgan Stanley Direct Lending Fund trades at a 27% NAV discount amid exaggerated SaaS sector fears and a recent dividend cut of 10%.MSDL did not fully cover its dividend with net investment income, and the investment firm saw a significant uptick in its non-accruals.The investment firm has about 20% exposure to SaaS companies, which is about industry standard. While I don't fear rising SaaS loan defaults, the dividend cut is a negative.Shares trade at a 27% NAV discount, but I would not yet recommend buying the drop amid sentiment concerns and uncertainty about the firm's NII trajectory. Richard Drury/DigitalVision via Getty Images Fears over defaulting loans in the SaaS space, a sector that private credit platforms heavily lend money to, have created serious selling pressure for BDCs lately, many of which are now trading at 52-week lows. While I recentlyThis article was written byThe Asian Investor31.58K FollowersFollowI am interested in a lot of technology and AI stocks like Google, Nvidia, AMD, Tesla and Amazon.Analyst’s Disclosure: I/we have a beneficial long position in the shares of ARCC, BXSL, HTGC either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.