Sixth Street Specialty Lending: Income Investors Should Remain Cautious, But The 10% Yield Makes It A Buy

Sixth Street Specialty Lending is upgraded from Hold to Buy, driven by robust dividend coverage and a justifiable 8.4% premium to NAV. TSLX's fundamentals remain solid with a 10% yield, 113% dividend coverage, and strong liquidity, despite recent declines in net investment income and NAV. Portfolio risk remains contained with non-accruals under 1% and a declining leverage ratio, but economic uncertainty and war-related risks warrant caution.