Oppenheimer Reiterates Perform Rating on Digital Realty Trust (DLR)

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Oppenheimer is out with an analyst note this morning that reiterates their Perform rating on shares of Digital Realty Trust
DLR
; they do not have a price target for the REIT. Oppenheimer cited DLR’s recently announced the acquisition of a five-property data center portfolio of 365 Main. DLR acquired the ~919K sq. ft. portfolio for $725M, to be funded using available cash/revolving credit borrowings and a ~$275M equity offering. The portfolio will expand DLR's data center footprint in rapidly-growing markets in California, Arizona, and Northern Virginia, and includes capacity for 250K sq. ft. of incremental expansion. Analysts noted that “Importantly, the acquisition is expected to be accretive to 2010 FFO/shr, and management plans to offer updated guidance following the 2Q10 earnings announcement.” They believe that DLR remains positively leveraged to the ongoing migration to network centric computing, but the company's premium valuation versus peers keeps them neutral on the name.
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Posted In: Analyst ColorAnalyst RatingsFinancialsOffice REIT'sOppenheimer & Co.
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