Barclays increased it price target on Equinix Inc EQIX. According to the report published on Tuesday, the bank now expects the stock price to trade at $360, up from the $340 estimated previously.
Barclays emphasized the importance of the upcoming analyst day given several facts, including the combination of a variety of secular demand trends, an evolving investor base and prevailing questions on the pace of the Telecity integration. After conducting several meeting with Equinix management, the analysts predict "incremental color on the timing of an anticipated inflection in enterprise cloud adoption to remain elusive."
Yet, the analysts expect the company to provide confident signals concerning demand trends in the near term, such as a possible positive revision to its longer-term growth outlook, probability for revenue synergies from the deals made recently, etc. "We expect management to provide a positive lift (>10 percent CAGR) to its now dated multi-year revenue growth targets (>8 percent CAGR) from its prior analyst day two years ago," wrote Barclays.
Although the attractive multiple of Equinix stock is an indicator of future growth, the upcoming analyst day will provide confidence to investors that there is "no reason for its fundamental demand drivers to abate anytime soon."
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