MSDL Stock: $0.45 Dividend, $0.45 of Income, NAV $19.50

What MSDL is, and two things to get right

MSDL is the listed Morgan Stanley BDC. It raised money from private investors through capital commitments, then closed its IPO on January 26, 2024, selling 5,000,000 shares at $20.67, equal to its December 31, 2023 NAV per share; shares began trading on the NYSE on January 24, 2024 (FY2023 10-K). The IPO raised about $97.1 million of net cash before offering expenses. The adviser is MS Capital Partners Adviser Inc. The company files under CIK 1782524 and is not the same entity as the non-traded North Haven Private Income Fund, which has its own CIK and its own NAV, though the two are run by the same adviser and sit side by side in the table further down.

Two things worth knowing before the numbers. First, MSDL no longer pays specials: the only special dividends in the 10-Ks are two of $0.10, declared on January 11, 2024 and paid with the third- and fourth-quarter 2024 dividends. Second, at IPO the pre-IPO holders, about 88.0% of the shares, agreed to a 365-day lock-up with staged releases: 33% from July 21, 2024, a further 33% from October 19, 2024, and the rest from January 22, 2025 (FY2023 10-K). That lock-up is over; it does not bind anyone today.

The dividend against income: ten quarters

Every row is from the filing named in the CSV. Cover is NII per share divided by the regular dividend per share (our arithmetic). Price is the "per share market value, end of period" in each 10-Q or 10-K financial highlights, the only share price the filings give.

Annual figures from the FY2025 10-K financial highlights tell the same story: NII per share was $2.34 (2021), $2.08, $2.67 (2023), $2.48 and $2.02 (2025); dividends declared were $2.07, $1.92, $2.27, $2.20 and $2.00. The first half of 2026 shows NII of $0.92 against $0.90 of dividends, 102%. On the $0.45 quarterly rate, the annual dividend is $1.80; against the June 30 price of $15.12 that is 11.9% (our arithmetic, a price from three and a half months ago, not a quote).

Why income fell: lower rates, fewer earning loans, fees that move with the cap

Total investment income was $88.8 million in Q2 2026 against $99.5 million a year earlier, down 10.8%; NII after taxes was $38.2 million against $43.7 million, down 12.6% (our arithmetic). Weighted average yield on debt investments at amortized cost went from 10.4% (December 2024) to 9.1% (June 2026), with 99.6% of the book floating-rate. The company said the Q2 decrease in investment income was "primarily driven by the impact of positions placed on non-accrual, and partially offset by the impact of the Capstone JV" (August 6, 2026 release). Interest and financing expense also fell, from $34.7 million to $32.0 million.

Fees are where MSDL differs from a flat-fee fund. The base management fee is 1.00% of average gross assets (excluding cash). The income incentive fee is 17.5% of pre-incentive NII above a 6.0% annualised hurdle, with a catch-up, measured over trailing twelve quarters and limited by an Incentive Fee Cap equal to 17.5% of cumulative pre-incentive net return, which includes realised losses. From the IPO to January 24, 2025 the adviser waived base fees above 0.75% and charged 15% instead of 17.5% on income; waivers were $22.9 million in 2023, $9.9 million of management fee and $6.0 million of incentive fee in 2024, and $0.6 million of management fee and $0.4 million of incentive fee in 2025, the tail of the waiver (10-Ks).

The cap has limited the fee: the May 7, 2026 release says income-based incentive fees "declined due to the incentive fee cap, which limits the amount payable to the Adviser based on net realized losses". The corollary is that realised losses, which were $20.6 million in the first half of 2026, are being absorbed partly by the adviser's lower fee and partly by NAV.

NAV, the share price and the buyback

NAV per share peaked at $20.83 in June and September 2024 and was $19.50 on June 30, 2026, down 6.4% (our arithmetic) and 5.7% from the $20.67 IPO price. Net assets were $1.648 billion on 84,504,322 shares, against $1.748 billion on 86,276,305 shares at year-end. The half-year bridge from the financial highlights: NAV $20.26, plus NII $0.92, minus $0.88 of net realised and unrealised loss, minus $0.90 of dividends, plus $0.10 from repurchases, equals $19.50.

The filings state a premium or discount in one way: the period-end share price printed in the financial highlights. It was a 4.3% premium to NAV at March 31, 2024, flat at December 31, 2024 (-0.7%) and a 22.5% discount at June 30, 2026, after touching 29.5% at March 31, 2026. The company's own buying is a second reading. The board authorised a $100 million repurchase program in February 2026 (24 months, only at prices below NAV), and repurchases were 1,771,973 shares in the first half: 358,300 in January at $16.47, 308,900 in February at $15.55, 273,287 in March at $14.64, 460,500 in April at $14.82 and 370,986 in May at $15.33. In the second quarter it paid an average $15.06 against a NAV of $19.50, 22.8% below (our arithmetic). $83.5 million remained at June 30. In 2024 it bought 924,596 shares at about $20 and in 2025 2,234,784, at prices that fell from $20.38 in March to $16.79 in November. Shares outstanding fell from 88.5 million at December 2024 to 84.5 million (our arithmetic: -4.5%).

Non-accruals: seven issuers, $106 million at cost, $63 million at fair value

MSDL's 10-Q gives the non-accrual share at amortized cost and not at fair value, so the cost series is the one the company states. It rose from 0.2% to 2.9% in six quarters.

Cost jumped by $51.0 million in one quarter while risk rating 4 grew from 1.0% to 1.8% of fair value ($36.1 million to $64.7 million). For fair value we added up the lines in the June 30, 2026 schedule of investments that carry the non-accrual footnote; their cost is $106,451 thousand, the exact figure in the non-accrual table, and their fair value is $62,573 thousand, 1.8% of $3.554 billion (our arithmetic).

The schedule has eight issuer names against the "seven" the filing counts; two Continental names belong to the same company group, which is how we read it. Spectrio alone is 56% of the fair value and 46% of the cost. For the wider list of how listed and non-traded BDCs compare on this measure, see our private credit non-accruals page.

PIK, software and what the book looks like

PIK income, interest paid in kind, is non-cash income that counts toward what the company must distribute. In the income statement it was 2.7% of total investment income in Q1 2024, 4.1% in Q1 2025 and 5.6% in Q2 2026 ($4.9 million of $88.8 million; our arithmetic), and 1.2%, 2.6% and 4.0% for 2023, 2024 and 2025. The cash-flow statement line "payment-in-kind interest and dividend capitalized" was $11.3 million for the first half of 2026, 6.4% of income (our arithmetic), because preferred PIK dividends are in dividend income. The 10-Q says the adviser "is not obligated to return any incentive fee it receives on PIK interest that is later determined to be uncollectible in cash".

At June 30, 2026 the portfolio was $3.554 billion of fair value ($3.677 billion at cost) across 229 companies and 36 industries, an average position of $15.5 million, 0.4%. After software, the largest sectors were IT Services (9.8%) and Insurance Services (9.7%). First-lien debt was 93.1% and the Capstone Lending joint venture 2.9% ($102.5 million). MSDL committed up to $200 million and its partner $50 million to the JV, and 52.3% of the commitments had been called at June 30; the JV paid MSDL $3.0 million of dividend income in Q2, 3.4% of total investment income (our arithmetic). Software was 14.2% of the book at December 2023.

Debt: a $425 million note due in February 2027

Total debt principal was $2.001 billion at June 30, 2026, with $1.47 billion unused on the facilities, $71.6 million of cash and a weighted average interest rate of 5.40% in Q2. Debt to equity was 1.21x and net debt to equity 1.17x.

The 2031 Notes closed after quarter-end, and the 8-K says the company "intends to use the net proceeds to repay outstanding secured indebtedness under its financing arrangements"; net proceeds were about $341.6 million. That leaves the $425 million 4.50% 2027 Notes as the one unsecured maturity inside the next 12 months, and the replacement coupons are higher: 6.10% against 4.50% (our arithmetic: +160 basis points on $425 million is about $6.8 million a year, $0.08 a share, if refinanced at the 2031 rate).

MSDL and North Haven Private Income Fund

Both funds are managed by MS Capital Partners Adviser Inc., but one trades on the NYSE and the other sells and repurchases units at NAV. From the filings:

The structural difference is the exit. An MSDL holder can sell at any time at a market price that has been far under NAV; a North Haven holder has a price at NAV but sold 41.6% of what was asked in the June 2026 offer. Details in our North Haven redemptions page, and a longer list of listed names in BDC stocks 2026.

What changed since the 10-Q, and what comes next

Since the June 30 10-Q: the 2031 Notes (July 9), the $0.45 dividend declared August 4, a director's resignation on September 26 that the 8-K says was "not the result of any disagreement with the Company", and the October 5 announcement that results come on Thursday, November 5, 2026, after the market closes, with a call on Friday, November 6 at 10:00 a.m. ET. As of October 17, 2026 the 10-Q for the quarter ended September 30, 2026 is not on EDGAR. Last year the release and the 10-Q for the same quarter were filed on the same day, November 6, 2025 (EDGAR filing list), so we expect the 10-Q on or about November 5, 2026. The latest filed period is June 30, 2026.

What a holder or reader can do with this

This is analysis of public documents, not investment, legal or tax advice. What the filings let you check yourself:

• Look at cover with the fee in mind. Net investment income was $0.45 a share in the second quarter of 2026, covering 100% of the $0.45 regular dividend. Before the income incentive fee it was about $0.53 (our arithmetic). Ask next quarter how much of the cushion came from the cap.
• Compare the cost and the fair value of non-accruals. The 10-Q states 2.9% at cost; the schedule implies 1.8% at fair value. A change in the Spectrio marks, $35.1 million, moves NAV by about $0.04 a share for each 10% (our arithmetic: $3.5 million over 84.5 million shares).
• Read price against NAV with both numbers. The 10-Q gives the June 30 price, $15.12, and NAV, $19.50; neither is today's quote. Check both on the day you decide.
• Watch four dates. The Q3 results on November 5; the $0.45 dividend payable on or around October 23; the February 11, 2027 maturity of $425 million of 4.50% notes; and the buyback, $83.5 million of capacity at June 30.
• Know what you own twice. If you also hold North Haven Private Income Fund, the two have separate NAVs and separate fee terms; see the table above.
• Tax. BDC distributions are reported on Form 1099-DIV; see our 1099-DIV timeline. A sale at a loss has its own treatment; ask a tax professional.

If a large part of your savings or income sits in one or two private credit BDCs, a conversation with a qualified adviser about how it fits the rest of your holdings may be worth having.

FAQ

All figures are from Morgan Stanley Direct Lending Fund's SEC filings (CIK 1782524) read on EDGAR on October 17, 2026: Form 10-Q for June 30, 2026 (accession 0001193125-26-337915), March 31, 2026 (0001193125-26-211906), September 30, 2025 (0001193125-25-269438), June 30, 2025 (0001782524-25-000026), March 31, 2025 (0001782524-25-000018), September 30, 2024 (0001782524-24-000041), June 30, 2024 (0001782524-24-000029) and March 31, 2024 (0001782524-24-000020); Form 10-K for 2025 (0001193125-26-076632), 2024 (0001782524-25-000009) and 2023 (0001782524-24-000009); the earnings releases furnished as Exhibit 99.1 to the Forms 8-K of August 6, 2026 (0001193125-26-338351), May 7, 2026 (0001193125-26-212041), February 26, 2026 (0001193125-26-076964), November 6, 2025 (0001193125-25-269710), August 7, 2025 (0001193125-25-175463), May 8, 2025 (0001193125-25-115968) and November 7, 2024 (0001193125-24-253290); and the Forms 8-K of April 23, July 9, September 26 and October 5, 2026. North Haven Private Income Fund figures are from its Form 10-Q for June 30, 2026 (CIK 1851322, accession 0001193125-26-342549). Cover ratios, the fair value of non-accrual lines (the sum of the flagged lines in the June 30, 2026 schedule of investments), price-to-NAV percentages, per-share effects and percentage changes are our arithmetic. This is analysis of public documents, not investment, legal or tax advice.