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Digital Realty Trust Inc DLR

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Digital Realty Begins 2021 With Good Q1 as Global Vision and Focus on Connectivity Bear Fruit

Matthew Dolgin, CFA Equity Analyst

Analyst Note

| Matthew Dolgin, CFA |

Digital Realty beat FactSet consensus revenue and EBITDA estimates and delivered another period of strong bookings, well distributed across all geographies, in the first quarter. However, we expect this type of execution from the company, as we believe its Interxion acquisition and global expansion make it a premier data center provider, and we are not materially changing our forecast. While Digital Realty raised its full-year revenue and EBITDA outlook, much of it can be explained by more-favorable foreign-exchange rates than it previously anticipated and strong power reimbursements realized during the first quarter in the wake of the storm and power outages in Texas. We are raising our fair value estimate to $127 per share from $125 and like the company, but we think it is expensive at current levels.

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Company Profile

Business Description

Digital Realty owns and operates nearly 300 data centers worldwide. It has more than 35 million rentable square feet across five continents. Digital's offerings range from retail co-location, where an enterprise may rent a single cabinet and rely on Digital to provide all the accommodations, to "cold shells," where hyperscale cloud service providers can simply rent much, or all, of a barren, power-connected building. In recent years, Digital Realty has de-emphasized cold shells and now primarily provides higher-level service to tenants, which outsource their related IT needs to Digital. Digital Realty has also moved more into the co-location business, increasingly serving enterprises and facilitating network connections. Digital Realty operates as a real estate investment trust.

Contact
Four Embarcadero Center, Suite 3200
San Francisco, CA, 94111
T +1 415 738-6500
Sector Real Estate
Industry REIT - Office
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2021
Stock Type Hard Assets
Employees 2,878

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