RCS: NAV Growth May Lead To A Higher Dividend (Rating Upgrade)

PIMCO Strategic Income Fund is upgraded to Hold as valuation premium narrows, but downside risks persist. RCS's 8.5% yield is supported by resilient earnings, though payout growth depends on interest rate declines and NAV improvement. The portfolio is 66% investment grade, heavily allocated to short-dated securities and levered, making it sensitive to rate and default risks.