UPDATE: Cantor Fitzgerald Downgrades CoreSite Realty Corp. to Sell, Raises PT on Stock Overvalue

In a report published Friday, Cantor Fitzgerald analyst David Toti downgraded the rating on CoreSite Realty Corp. COR from Hold to Sell, but raised the price target from $28.50 to $32.50. In the report, Toti noted, “We expect CoreSite's business model to remain viable, given our demand growth expectations. Further, we view CoreSite's strategy to be among the most defensive of the data center REITs due to the smaller increments of leasing and development. We believe this is a shared view, as COR has significantly outperformed the REITs, returning 28% YTD and 54% LTM, which compares to 10% YTD and 19% LTM for REITs overall. Today, we believe the stock to be overvalued, given the 6.2% implied cap rate and the 25% premium to which the stock currently trades, relative to our revised NAV estimate of $28.10. Our revised price target of $32.50 (from $28.50) includes a 15.7% applied NAV premium to account for future growth and balance sheet stability, and implies a -4.4% total return, which compares unfavorably to our RMZ expectation of 8.3%.” CoreSite Realty Corp. closed on Thursday at $35.14.