Nuveen Churchill Direct Lending

NCDL

Market cap $650M

We take a look at the action in business development companies through the last week of February and highlight some of the key themes we are watching. BDCs fell sharply on Friday, likely as a result of a bankruptcy of a UK mortgage provider. Q4 earnings are largely fine in aggregate, if not spectacular.

Nuveen Churchill Direct Lending Corp (NCDL) remains under pressure, with a 25.6% share price decline and a 20% dividend cut despite a deep NAV discount. NCDL's portfolio struggles with negative net funded investment activity and persistent NAV erosion, as new investments fail to offset sales and repayments. Debt-to-equity has risen to 1.27x, and while non-accruals are low at 0.5%, limited portfolio growth and high rates threaten further deterioration.

Nuveen Churchill Direct Lending Corp. (NCDL) came out with quarterly earnings of $0.44 per share, beating the Zacks Consensus Estimate of $0.43 per share. This compares to earnings of $0.56 per share a year ago.

Nuveen Churchill Direct Lending Corp. (NCDL) Q4 2025 Earnings Call Transcript

NEW YORK--(BUSINESS WIRE)--Nuveen Churchill Direct Lending Corp. (NYSE: NCDL) (“NCDL” or the “Company”), a business development company externally managed by its investment adviser, Churchill DLC Advisor LLC (the “Adviser”), and by its sub-adviser, Churchill Asset Management LLC (“Churchill”), today reported financial results for the full year and fourth quarter ended December 31, 2025. Financial Highlights for the Quarter Ended December 31, 2025 Net investment income of $0.44 per share Net rea.

NEW YORK--(BUSINESS WIRE)--Nuveen Churchill Direct Lending Corp. (NYSE: NCDL) (“NCDL” or “the Company”), today announced it will report its financial results for the fourth quarter and full year ended December 31, 2025, on Thursday, February 26, 2026, before the market opens. The Company will host an earnings conference call and public webcast at 10:00 AM Eastern Time the same day to discuss its financial results. All interested parties may participate in the conference call by dialing (866)-60.

The Dividend Power strategy highlights 35 high-yield, low-valuation stocks, with 6 identified as 'safer' due to strong free cash flow coverage. The top ten DiviPower stocks are projected to deliver an average net gain of 40.62% by January 2027, with risk/volatility 14% below the market. Seventeen of thirty-five Dividend Power Dogs show negative free cash flow margins, signaling unsustainable dividends and elevated risk.

Investors have started to question how sustainable BDC dividends are. A lot of this skepticism is logical and justified by valid reasons. My calculus shows that on average BDCs could cut their dividends by 20% in order to avoid NAV erosion.

Nuveen Churchill Direct Lending Corp. is rated a sell due to declining NAV, weak earnings, and unsustainable dividend coverage. NCDL trades at a 22.46% discount to NAV, reflecting persistent headwinds, not a value opportunity. Net investment income fell to $0.43 per share, below the $0.45 dividend, signaling risk of a future cut.

Nuveen Churchill Direct Lending Corp. has recently been underperforming some of its closest peers. Yet, despite a material decline in share price, NCDL's P/NAV is almost exactly the same as for the sector median. In the article, I share my views on which direction NCDL is likely headed and why.