Digital Realty (DLR) AI Stock Analysis

• Market Cap: $60.48B
• Dividend Yield: 3.17%
• Average Volume (3M): 2.00M
• Price to Earnings (P/E): 49.2
• Beta (1Y): 0.72
• Revenue Growth: 7.75%
• EPS Growth: 216.77%
• Country: US
• Employees: 3,936
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Office
• EPS (TTM): 0.24
• Shares Outstanding: 343,615,450
• 10 Day Avg. Volume: 2,316,468
• 30 Day Avg. Volume: 2,000,855
• PEG Ratio: 0.36
• Price to Book (P/B): 2.32
• Price to Sales (P/S): 8.69
• P/FCF Ratio: 22.03
• Enterprise Value/Market Cap: 1.34
• Enterprise Value/Revenue: 13.10
• Enterprise Value/Gross Profit: 32.74
• Enterprise Value/Ebitda: 21.42
• 1Y Price Target: $191.56
• Price Target Upside: 8.28% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 19
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: $194.00 ▲(9.67% Upside)

The score is driven primarily by improving financial performance (growth and a 2025 margin rebound, though tempered by cash-flow quality and modest ROE) and a constructive earnings outlook (positive 2026 guidance with strong bookings/backlog). Technicals add support via an established uptrend, while valuation is the main drag due to a high P/E despite a moderate dividend yield.

Positive Factors

Large Bookings & Backlog

A sizable, multi-year backlog gives durable revenue visibility and de-risks near-term cash flows, enabling more predictable commencements and financing of development projects. This supports disciplined capacity buildout and smoother FFO conversion as leases roll into revenue over 2026–2028.

Hyperscale & Interconnection Momentum

Strong demand from hyperscalers and accelerating interconnection bookings diversifies revenue toward higher-margin, sticky customers. This structural shift increases pricing power and recurring cash flows, and supports long-term occupancy and utilization across key metros where hyperscale growth is concentrated.

Strong Liquidity & Funding Optionality

Robust liquidity and substantial private-capital commitments provide durable funding flexibility to execute costly developments, recycle capital, and pursue acquisitions without forcing distressed financing. Expanded fee income also diversifies earnings and reduces reliance on single revenue sources over economic cycles.

Negative Factors

Rising Capital Intensity

Escalating development and recurring CapEx increases capital intensity, pressuring free cash flow conversion and raising funding needs. Sustained high capex limits near-term distributable cash and heightens execution risk if project timings or yields slip amid tighter labor and supply conditions.

Power & Regulatory Constraints

Structural limits on grid capacity and rising local regulatory friction can restrict new supply in critical metros, constraining growth and elevating development costs. Over time this can force longer timelines, higher capex for grid solutions, or loss of deals to operators with better localized power arrangements.

Interest Expense Headwind

Debt repricing that increases coupon costs raises finance expenses and reduces net income/FFO margins, making the REIT more sensitive to rising rates. Over several quarters this compresses cash flow available for capex, distributions, or reinvestment unless offset by higher revenue or efficiency gains.

Digital Realty Business Overview & Revenue Model

Company Description

Digital Realty supports the world's leading enterprises and service providers by delivering the full spectrum of data center, colocation and interconnection solutions. PlatformDIGITALR, the company's global data center platform, provides customers a trusted foundation and proven Pervasive Datacenter Architecture PDxTM solution methodology for scaling digital business and efficiently managing data gravity challenges. Digital Realty's global data center footprint gives customers access to the connected communities that matter to them with more than 284 facilities in 48 metros across 23 countries on six continents.

How the Company Makes Money

Digital Realty generates revenue primarily through leasing data center space to customers, which includes both colocation and powered shell services. The company charges customers based on the amount of space they occupy and the power they consume. Additionally, Digital Realty earns income through interconnection services, where customers pay for direct connections to other networks and service providers. The company has established significant partnerships with major cloud service providers, telecommunications companies, and enterprises, enhancing its revenue potential. Furthermore, Digital Realty's strategy includes expanding its footprint through acquisitions and developments, which contributes to long-term revenue growth by increasing its customer base and service offerings.

Digital Realty Financial Statement Overview

Summary

Steady revenue growth and a meaningful 2025 profitability rebound support the score, and leverage appears manageable for a REIT with improving debt-to-equity. Offsetting factors are volatile earnings across years, modest ROE, and uneven cash conversion (operating cash flow below net income in 2025) with historically volatile free cash flow.

Income Statement

Revenue is growing steadily, accelerating to about 3.4% in 2025 after a flat 2024. Profitability improved meaningfully in 2025, with net margin rising to ~21% from ~11% in 2024, and consistently strong gross profitability (~53–60%). Offsetting this, earnings have been volatile across the period (notably a very strong 2021, then a sharp drop in 2022, followed by recovery), which suggests results can swing with non-operating items or one-time impacts.

Balance Sheet

Leverage is moderate for a REIT, with debt running at ~0.84–1.03x equity and improving to ~0.86x in 2025 from a peak above 1.0x in 2022. Equity has grown over time, providing a solid capital base. The main constraint is that returns on equity remain modest (roughly ~2% to ~9% historically and ~5.7% in 2025), indicating profitability is not consistently high relative to the capital employed.

Cash Flow

Operating cash flow is solid and rising overall (from ~$1.6–$1.7B in 2020–2023 to ~$2.4B in 2025), supporting business resilience. However, cash flow quality versus reported earnings is mixed: operating cash flow covers only ~0.64x of net income in 2025 (and was even lower in 2023–2024), and free cash flow was negative in 2020–2022 before turning positive in 2023–2025, with a slight decline in 2025. This points to variability in cash conversion and/or elevated investment needs.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.11B	5.55B	5.48B	4.69B	4.43B
Gross Profit	3.39B	3.04B	2.88B	2.67B	2.65B
EBITDA	3.59B	2.87B	3.16B	2.29B	3.60B
Net Income	1.31B	602.49M	948.84M	377.68M	1.71B
Balance Sheet
Total Assets	49.41B	45.28B	44.11B	41.48B	36.37B
Cash, Cash Equivalents and Short-Term Investments	3.45B	3.87B	1.63B	141.77M	142.70M
Total Debt	24.18B	18.01B	18.97B	18.07B	14.96B
Total Liabilities	24.56B	22.11B	23.12B	21.86B	17.85B
Stockholders Equity	22.93B	21.34B	19.12B	17.58B	18.00B
Cash Flow
Free Cash Flow	2.41B	-570.26M	-1.89B	-983.71M	-818.54M
Operating Cash Flow	2.41B	2.26B	1.63B	1.66B	1.70B
Investing Cash Flow	-2.23B	-1.91B	-1.12B	-4.70B	-1.06B
Financing Cash Flow	-486.74M	2.06B	963.47M	2.97B	-590.63M

Digital Realty Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 176.90
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DLR, the sentiment is Positive. The current price of 176.9 is above the 20-day moving average (MA) of 169.26, above the 50-day MA of 161.31, and above the 200-day MA of 166.21, indicating a bullish trend. The MACD of 5.02 indicates Negative momentum. The RSI at 65.61 is Neutral, neither overbought nor oversold. The STOCH value of 64.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DLR.

Digital Realty Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DLR	69 Neutral	$60.48B	49.16	5.91%	3.17%	7.75%	216.77%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
ARE	60 Neutral	$9.39B	-6.33	-8.62%	10.90%	-0.76%	-250.60%
KRC	56 Neutral	$3.86B	13.93	5.09%	5.75%	0.77%	62.58%
VNO	55 Neutral	$6.16B	7.08	16.24%	2.24%	2.41%	―
CUZ	53 Neutral	$4.01B	99.46	0.85%	5.08%	16.38%	3.60%
BXP	52 Neutral	$10.72B	35.33	5.24%	5.26%	2.54%	-155.17%

Digital Realty Corporate Events

Digital Realty Maintains Capital Flexibility With New Shelf Filing

On February 17, 2026, Digital Realty Trust, Inc. and its operating partnership filed a new automatic shelf registration statement with the U.S. SEC, replacing a prior shelf that was set to expire in March 2026, thereby maintaining their ability to access capital markets efficiently. On the same date, the company also filed an at-the-market equity prospectus supplement under its existing sales agreement with a syndicate of banks, leaving approximately $1.89 billion in common stock capacity available for future issuance, which preserves funding flexibility for ongoing corporate and growth needs.

The filing formalizes the transition from the previous registration statement to the new one without interruption, ensuring continuity in the company’s registered securities program. An accompanying legal opinion on the validity of the common shares was submitted, reinforcing the company’s readiness to issue additional stock as market conditions and strategic requirements warrant.

The most recent analyst rating on (DLR) stock is a Buy with a $206.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.

Digital Realty Releases Q4 2025 Results, Highlights IR Plans

On February 5, 2026, Digital Realty released its financial results for the quarter ended December 31, 2025, and furnished investors with an earnings press release, a detailed financial supplement and other supporting materials via its website. The company also posted presentation materials the same day and outlined an active investor-relations calendar with multiple real estate and technology-focused conferences scheduled through March 2026, underscoring its efforts to maintain broad analyst coverage and engagement with institutional investors following the latest quarterly results.

The most recent analyst rating on (DLR) stock is a Hold with a $181.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.

Digital Realty Elects Stephen Bolze as New Director

On December 15, 2025, Digital Realty Trust, Inc. announced the election of Stephen R. Bolze as an independent director to its Board, effective January 1, 2026. Bolze, with over 30 years of experience in infrastructure and industrial management, previously held senior roles at Blackstone and General Electric, and is the founder & CEO of Standish Spring Investments. His appointment includes membership on the Audit Committee and a compensation package involving equity awards and cash retainers, reflecting Digital Realty’s strategic focus on strengthening its leadership team.

The most recent analyst rating on (DLR) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.

Digital Realty Announces Redemption of Euro Notes

On December 3, 2025, Digital Realty announced that its subsidiary, Digital Euro Finco, LLC, will redeem the €1,075 million of its 2.500% Guaranteed Notes due 2026 on December 18, 2025. This redemption reflects Digital Realty’s strategic financial management, potentially impacting its financial structure and market positioning by eliminating outstanding debt obligations.

The most recent analyst rating on (DLR) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.

Digital Realty Issues €1.4 Billion in Euro Notes

On November 20, 2025, Digital Euro Finco, LLC, a subsidiary of Digital Realty Trust, Inc., issued €600 million of 3.750% Guaranteed Notes due 2033 and €800 million of 4.250% Guaranteed Notes due 2037. These Euro Notes, sold outside the U.S. under Regulation S, are senior unsecured obligations guaranteed by Digital Realty Trust, Inc. The net proceeds of approximately €1,384.7 million will be allocated to finance or refinance Eligible Green Projects, including renewable energy and sustainable management initiatives, with potential interim uses including debt repayment and investment in interest-bearing accounts.

The most recent analyst rating on (DLR) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.