Financial Review: Aura FAT Projects Acquisition (NASDAQ:AFAR) versus Morgan Stanley Direct Lending (NYSE:MSDL)

Aura FAT Projects Acquisition (NASDAQ:AFAR) and Morgan Stanley Direct Lending (NYSE:MSDL) are both small-cap unclassified companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Earnings and Valuation

This table compares Aura FAT Projects Acquisition and Morgan Stanley Direct Lending”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aura FAT Projects Acquisition	N/A	N/A	N/A	N/A	N/A
Morgan Stanley Direct Lending	$257.79 million	7.00	$231.01 million	$2.55	7.97

Morgan Stanley Direct Lending has higher revenue and earnings than Aura FAT Projects Acquisition.

Analyst Ratings

This is a summary of current ratings and target prices for Aura FAT Projects Acquisition and Morgan Stanley Direct Lending, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aura FAT Projects Acquisition	0	0	0	0	0.00
Morgan Stanley Direct Lending	0	5	1	0	2.17

Morgan Stanley Direct Lending has a consensus target price of $21.42, suggesting a potential upside of 5.35%. Given Morgan Stanley Direct Lending’s stronger consensus rating and higher probable upside, analysts clearly believe Morgan Stanley Direct Lending is more favorable than Aura FAT Projects Acquisition.

Profitability

This table compares Aura FAT Projects Acquisition and Morgan Stanley Direct Lending’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Aura FAT Projects Acquisition	N/A	N/A	N/A
Morgan Stanley Direct Lending	54.89%	12.69%	6.52%

Institutional & Insider Ownership

53.3% of Aura FAT Projects Acquisition shares are owned by institutional investors. 49.7% of Aura FAT Projects Acquisition shares are owned by company insiders. Comparatively, 0.2% of Morgan Stanley Direct Lending shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Morgan Stanley Direct Lending beats Aura FAT Projects Acquisition on 7 of the 9 factors compared between the two stocks.

About Aura FAT Projects Acquisition

Aura FAT Projects Acquisition Corp does not have significant operations. The company intends to effect a merger, share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses. It focuses on acquiring technology companies with Web 3.0, blockchain, cryptocurrency, digital ledger, e-gaming, and other new financial technology and services applications in Southeast Asia, Australia, and New Zealand. The company was incorporated in 2021 and is based in Singapore.

About Morgan Stanley Direct Lending

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.