Digital Realty Trust: A Prime Investment in AI Data Centers
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Should l Buy DLR?
Source: Fool
- Market Leadership: Digital Realty Trust operates over 300 data centers across 50 cities, serving more than 5,000 customers, establishing itself as the world's largest data center operator and highlighting its critical role in the rapidly growing AI data center sector.
- Revenue Structure Advantage: As a Real Estate Investment Trust (REIT), Digital Realty Trust distributes most of its profits as dividends to shareholders, avoiding corporate-level taxation, which allows investors to benefit more from the growth of the AI data center industry.
- Industry Growth Potential: According to Precedence Research, the AI data center industry is expected to grow at an average annual rate of over 27% through 2035, and Digital Realty Trust's structure positions it to capitalize on this growth trend, despite its third-quarter revenue growth being only 10%.
- Stable Dividend Yield: Although it has not raised its annual payout since 2022, Digital Realty Trust still offers a forward-looking dividend yield of nearly 3%, providing investors with a stable income source amid the surge in AI-driven demand.
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Analyst Views on DLR
Wall Street analysts forecast DLR stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for DLR is 189.06 USD with a low forecast of 139.00 USD and a high forecast of 220.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
18 Analyst Rating
15 Buy
2 Hold
1 Sell
Strong Buy
Current: 166.790
Low
139.00
Averages
189.06
High
220.00
Current: 166.790
Low
139.00
Averages
189.06
High
220.00
About DLR
Digital Realty Trust, Inc. is a real estate investment trust. The Company owns, acquires, develops, and operates data centers through its operating partnership subsidiary, Digital Realty Trust, L.P. The Company is focused on providing data center, colocation, and interconnection solutions for domestic and international customers across a variety of industry verticals ranging from cloud and information technology services, communications and social networking to financial services, manufacturing, energy, healthcare, and consumer products. Its portfolio consists of over 308 data centers, of which 121 are located in the United States, 112 are located in Europe, 36 are located in Latin America, 16 are located in Africa, 16 are located in Asia, six are located in Australia and three are located in Canada. Its PlatformDIGITAL is a global data center platform for scaling digital business which enables customers to deploy their critical infrastructure with a global data center provider.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Digital Realty Trust to Announce Q4 Earnings on February 5th
- Earnings Announcement: Digital Realty Trust (DLR) is set to release its Q4 2023 earnings on February 5th after market close, with consensus estimates predicting a Funds From Operations (FFO) of $1.82 per share and revenue of $1.58 billion, indicating strong market anticipation regarding its financial performance.
- Market Outlook: Analysts maintain an optimistic view on Digital Realty's demand outlook for 2026, suggesting that the company's growth potential in the data center sector could drive its stock price higher, despite its current credit rating potentially underrepresenting its actual safety.
- Acquisition Expansion: By acquiring CSF Advisers, Digital Realty successfully enters the Malaysian market, which not only expands its business footprint in the Asia-Pacific region but also has the potential to generate new revenue streams, thereby enhancing its competitive position.
- Rating Upgrade: HSBC has upgraded Digital Realty's rating to
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- Revenue Structure Advantage: As a Real Estate Investment Trust (REIT), Digital Realty Trust distributes most of its profits as dividends to shareholders, avoiding corporate-level taxation, which allows investors to benefit more from the growth of the AI data center industry.
- Industry Growth Potential: According to Precedence Research, the AI data center industry is expected to grow at an average annual rate of over 27% through 2035, and Digital Realty Trust's structure positions it to capitalize on this growth trend, despite its third-quarter revenue growth being only 10%.
- Stable Dividend Yield: Although it has not raised its annual payout since 2022, Digital Realty Trust still offers a forward-looking dividend yield of nearly 3%, providing investors with a stable income source amid the surge in AI-driven demand.
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- South American Expansion: QSE signed a three-year security agreement with three Brazilian government clients for about 4,500 user licenses, marking its initial commercial footprint in the region and facilitating broader adoption of its services in the face of advancing quantum computing threats.
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- Earnings Announcement: Digital Realty Trust (DLR) is set to release its Q4 2023 earnings on February 5th after market close, with consensus estimates predicting a Funds From Operations (FFO) of $1.82 per share and revenue of $1.58 billion, indicating strong market anticipation regarding its financial performance.
- Market Outlook: Analysts maintain an optimistic view on Digital Realty's demand outlook for 2026, suggesting that the company's growth potential in the data center sector could drive its stock price higher, despite its current credit rating potentially underrepresenting its actual safety.
- Acquisition Expansion: By acquiring CSF Advisers, Digital Realty successfully enters the Malaysian market, which not only expands its business footprint in the Asia-Pacific region but also has the potential to generate new revenue streams, thereby enhancing its competitive position.
- Rating Upgrade: HSBC has upgraded Digital Realty's rating to
See More
Digital Realty Trust: A Prime Investment in AI Data Centers
- Market Leadership: Digital Realty Trust operates over 300 data centers across 50 cities, serving more than 5,000 customers, establishing itself as the world's largest data center operator and highlighting its critical role in the rapidly growing AI data center sector.
- Revenue Structure Advantage: As a Real Estate Investment Trust (REIT), Digital Realty Trust distributes most of its profits as dividends to shareholders, avoiding corporate-level taxation, which allows investors to benefit more from the growth of the AI data center industry.
- Industry Growth Potential: According to Precedence Research, the AI data center industry is expected to grow at an average annual rate of over 27% through 2035, and Digital Realty Trust's structure positions it to capitalize on this growth trend, despite its third-quarter revenue growth being only 10%.
- Stable Dividend Yield: Although it has not raised its annual payout since 2022, Digital Realty Trust still offers a forward-looking dividend yield of nearly 3%, providing investors with a stable income source amid the surge in AI-driven demand.
See More
Quantum Secure Encryption Corp Expands International Market Presence
- Surging Market Demand: The hybrid cloud market reached $194 billion in 2026 as European enterprises rapidly adopt sovereign architectures to comply with stringent data laws, positioning QSE as a pivotal player in the quantum security encryption sector amid rising demand.
- Key Agreement Renewal: QSE renewed its enterprise agreement with India's Muthoot Group, covering approximately 14,000 user licenses, which reinforces its strategic presence in the highly regulated Indian financial services sector, showcasing trust from large institutions.
- South American Expansion: QSE entered the Brazilian market with a three-year security agreement supporting three government clients for about 4,500 user licenses, establishing its initial commercial footprint in the region and facilitating broader adoption of its platform services.
- Strengthened International Collaboration: By joining the Canadian Association of Defence and Security Industries, QSE enhances its position within Canada's defense ecosystem and prepares for participation in the World Defense Show 2026, further expanding its international market influence.
See More
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- Surging Market Demand: The hybrid cloud market reached $194 billion in 2026 as European enterprises rush to comply with stringent data laws, significantly increasing the demand for quantum security encryption technologies, positioning QSE as a key player in this transformation.
- Key Agreement Renewal: QSE renewed its enterprise agreement with India's Muthoot Group, covering approximately 14,000 user licenses, reinforcing its long-term strategy in the Indian financial services sector and enhancing market trust.
- South American Expansion: QSE signed a three-year security agreement with three Brazilian government clients for about 4,500 user licenses, marking its initial commercial footprint in the region and facilitating broader adoption of its services in the face of advancing quantum computing threats.
- Strengthened International Collaboration: By joining the Canadian Association of Defence and Security Industries, QSE enhances its position within Canada's defense ecosystem and prepares for participation in the World Defense Show 2026, further driving its international expansion efforts.
See More
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- Earnings Reports: Despite the slump, most earnings reports released today were solid, though they were insufficient to reverse the negative trend.
See More
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