RBC Capital lowers Morgan Stanley Direct Lending stock price target to $19

Published 10/09/2025, 15:00
RBC Capital lowers Morgan Stanley Direct Lending stock price target to $19

Investing.com - RBC Capital has lowered its price target on Morgan Stanley Direct Lending (NYSE:MSDL) to $19.00 from $21.00 while maintaining an Outperform rating on the stock. Currently trading at $17.89, MSDL sits near its 52-week low of $17.37, with a market capitalization of $1.58 billion, according to InvestingPro data.

The firm revised its estimates following MSDL’s second-quarter results and incorporated an updated interest rate outlook that assumes Federal Reserve-driven rate reductions will occur primarily in 2026.

On a preliminary basis, RBC Capital is lowering its 2026 common dividend assumption for Morgan Stanley Direct Lending.

Despite the price target reduction, the firm continues to favor MSDL’s ability to leverage Morgan Stanley’s relationships and network, which it believes creates a potentially differentiated origination and sourcing funnel.

RBC Capital considers the current valuations of Morgan Stanley Direct Lending to be relatively attractive, supporting its decision to maintain an Outperform rating on the stock.

In other recent news, Morgan Stanley Direct Lending Fund announced the redemption of $275 million in senior notes. These notes, specifically the 7.55% Series A Senior Notes due in 2025, were redeemed at their full principal value, including accrued and unpaid interest. This redemption aligns with the terms established in the Master Note Purchase Agreement from September 2022. The move was documented in a filing with the Securities and Exchange Commission (SEC). This development is part of the company’s ongoing financial management strategies. The redemption took place on June 16, 2025, as specified in the agreement with the noteholders.

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