Market Overview

UPDATE: ISI Group Upgrades Digital Realty Trust to Buy, Raises PT

Related DLR
Digital Realty CEO Bill Stein: 'Data Center REITs Undervalued
Does Equinix Shameless Flirtation With Telecity Foreshadow Breakup For InterXion?
As Fed hike seems further off, data-center REITs stabilize (Seeking Alpha)

In a report published Monday, ISI Group upgraded its rating on Digital Realty Trust (NYSE: DLR) from Hold to Buy, and raised its price target from $68.00 to $72.00.

ISI Group noted, “We recently sat down with Mike Foust, CEO of Digital Realty, to discuss the company's leasing progress and outlook for the next 12 months, its capital deployment strategy heading into 2013, and its funding plans for the next 12 to 18 months. Given the stock's significant underperformance since late July (-19% vs. -4% for the REIT sector), a more attractive valuation, and reduced risk of the company missing its Q4 leasing targets, we are upgrading the stock from Hold to Buy and raising our price target from $68 to $72 which is a blend between our 2014 AFFO estimate, our forward NAV, and DCF estimate. Our PT rises entirely on better cash flow metrics as we assume LT leverage rises more than previously modeled (5.2x in 2016 vs. 4.8x previously) in-line with management's exceptions and an increase to our terminal growth rate in our DCF to 2.5% from 2.0% as we are more confident about the medium-term leasing outlook.”

Digital Realty Trust closed on Friday at $64.71.

Latest Ratings for DLR

May 2015UBSMaintainsSell
May 2015Deutsche BankMaintainsBuy
Apr 2015BarclaysMaintainsOverweight

View More Analyst Ratings for DLR
View the Latest Analyst Ratings

Posted-In: ISI GroupAnalyst Color Upgrades Analyst Ratings


Related Articles (DLR)

Around the Web, We're Loving...