Morgan Stanley Direct Lending Fund (NYSE:MSDL) & Crescent Capital BDC (NASDAQ:CCAP) Head-To-Head Review

Crescent Capital BDC (NASDAQ:CCAP) and Morgan Stanley Direct Lending Fund (NYSE:MSDL) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.

Valuation and Earnings

This table compares Crescent Capital BDC and Morgan Stanley Direct Lending Fund”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Crescent Capital BDC	$197.36 million	2.75	$73.65 million	$0.98	14.98
Morgan Stanley Direct Lending Fund	$416.08 million	3.67	$215.56 million	$1.65	10.66

Morgan Stanley Direct Lending Fund has higher revenue and earnings than Crescent Capital BDC. Morgan Stanley Direct Lending Fund is trading at a lower price-to-earnings ratio than Crescent Capital BDC, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

49.5% of Crescent Capital BDC shares are owned by institutional investors. 1.1% of Crescent Capital BDC shares are owned by company insiders. Comparatively, 0.2% of Morgan Stanley Direct Lending Fund shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Crescent Capital BDC and Morgan Stanley Direct Lending Fund’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Crescent Capital BDC	20.84%	9.76%	4.30%
Morgan Stanley Direct Lending Fund	35.92%	10.21%	4.70%

Analyst Recommendations

This is a summary of recent ratings for Crescent Capital BDC and Morgan Stanley Direct Lending Fund, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Crescent Capital BDC	1	1	3	1	2.67
Morgan Stanley Direct Lending Fund	0	5	2	0	2.29

Crescent Capital BDC presently has a consensus target price of $16.38, suggesting a potential upside of 11.55%. Morgan Stanley Direct Lending Fund has a consensus target price of $17.75, suggesting a potential upside of 0.94%. Given Crescent Capital BDC’s stronger consensus rating and higher possible upside, analysts plainly believe Crescent Capital BDC is more favorable than Morgan Stanley Direct Lending Fund.

Volatility and Risk

Crescent Capital BDC has a beta of 0.55, meaning that its share price is 45% less volatile than the S&P 500. Comparatively, Morgan Stanley Direct Lending Fund has a beta of 0.25, meaning that its share price is 75% less volatile than the S&P 500.

Dividends

Crescent Capital BDC pays an annual dividend of $1.68 per share and has a dividend yield of 11.4%. Morgan Stanley Direct Lending Fund pays an annual dividend of $2.00 per share and has a dividend yield of 11.4%. Crescent Capital BDC pays out 171.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Morgan Stanley Direct Lending Fund pays out 121.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crescent Capital BDC has raised its dividend for 1 consecutive years. Crescent Capital BDC is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

About Crescent Capital BDC

Crescent Capital BDC, Inc. is as a business development company private equity / buyouts and loan fund. It specializes in directly investing. It specializes in middle market. The fund seeks to invest in United States.

About Morgan Stanley Direct Lending Fund

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.