Digital Realty (DLR) AI Stock Analysis

• Market Cap: $58.36B
• Dividend Yield: 2.9%
• Average Volume (3M): 1.57M
• Price to Earnings (P/E): 43.9
• Beta (1Y): 0.76
• Revenue Growth: 7.75%
• EPS Growth: 216.77%
• Country: US
• Employees: 3,936
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Office
• EPS (TTM): 0.15
• Shares Outstanding: 343,501,560
• 10 Day Avg. Volume: 1,678,890
• 30 Day Avg. Volume: 1,571,314
• PEG Ratio: -2.23
• Price to Book (P/B): 2.69
• Price to Sales (P/S): 10.32
• P/FCF Ratio: 25.35
• Enterprise Value/Market Cap: 1.36
• Enterprise Value/Revenue: 13.41
• Enterprise Value/Gross Profit: 24.18
• Enterprise Value/Ebitda: 21.04
• 1Y Price Target: $198.94
• Price Target Upside: 17.10% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 19
• EPS Forecast (FY): 3.73
• Revenue Forecast (FY): $6.04B

• Rating: 70 Outperform
• Price Target: $188.00 ▲(10.66% Upside)

Digital Realty's overall stock score is driven by strong financial performance and positive earnings call guidance. While the technical analysis and valuation suggest caution due to high P/E and neutral trends, the company's robust backlog and strategic growth initiatives provide a solid foundation for future performance.

Positive Factors

Strong Backlog Growth

A growing backlog indicates strong future revenue visibility and demand for Digital Realty's services, supporting sustained growth.

AI-Oriented Deployments

High AI-related bookings suggest Digital Realty is well-positioned to capitalize on the growing AI market, driving future demand.

Sustainability Achievements

Strong sustainability credentials can enhance brand reputation and attract environmentally conscious clients, supporting long-term growth.

Negative Factors

Power Availability Challenges

Power and infrastructure constraints could limit Digital Realty's ability to expand and meet growing demand, impacting future growth.

Rising Operating Costs

Increasing operating costs can pressure margins, reducing profitability and potentially impacting financial performance over time.

Upcoming Debt Maturities

Significant debt maturities could strain cash flow and require refinancing, impacting financial flexibility and stability.

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 colocation and interconnection services. The company operates on a long-term lease model, typically securing multi-year contracts with its clients, which provides stable and predictable cash flows. Key revenue streams include monthly rental income from colocation services, as well as fees for interconnection services that allow clients to connect their infrastructure with other networks and service providers. Significant partnerships with major cloud service providers and telecommunications companies also contribute to its earnings, as these relationships drive demand for Digital Realty's data center solutions. Additionally, the company benefits from a growing market for data storage and processing, driven by increasing data consumption and digital transformation trends across various sectors.

Digital Realty Financial Statement Overview

Summary

Digital Realty demonstrates strong profitability and operational efficiency, with improving margins and a stable balance sheet. While revenue growth has decelerated, the company maintains a healthy cash flow position. Continued focus on growth strategies and leverage management will be crucial for sustaining long-term financial health.

Income Statement

Digital Realty shows a solid performance in its income statement with a consistent revenue growth rate and strong profitability margins. The TTM gross profit margin stands at 55.44%, and the net profit margin has improved significantly to 23.66%. The EBIT and EBITDA margins are also robust at 32.32% and 63.72%, respectively, indicating efficient operations. However, the revenue growth rate has slowed to 2.53% in the TTM, suggesting a need for strategic initiatives to accelerate growth.

Balance Sheet

The balance sheet reflects a stable financial position with a manageable debt-to-equity ratio of 0.85 in the TTM, showing a slight improvement from previous years. The return on equity has increased to 6.32%, indicating better utilization of equity. However, the equity ratio is not explicitly calculated, and the company should continue to monitor its leverage to maintain financial stability.

Cash Flow

Cash flow analysis reveals a positive trend with a 3.63% growth in free cash flow in the TTM. The operating cash flow to net income ratio is healthy at 0.80, and the free cash flow to net income ratio is 1.0, indicating strong cash generation relative to profits. However, past years showed negative free cash flow, highlighting the importance of maintaining cash flow improvements.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.91B	5.55B	5.48B	4.69B	4.43B	3.90B
Gross Profit	3.28B	3.04B	2.88B	2.67B	2.65B	2.39B
EBITDA	3.77B	2.87B	3.16B	2.29B	3.60B	2.10B
Net Income	1.40B	602.49M	948.84M	377.68M	1.71B	356.40M
Balance Sheet
Total Assets	48.73B	45.28B	44.11B	41.48B	36.37B	36.08B
Cash, Cash Equivalents and Short-Term Investments	3.30B	3.87B	1.63B	141.77M	142.70M	108.50M
Total Debt	19.51B	18.01B	18.97B	18.07B	14.96B	14.77B
Total Liabilities	23.74B	22.11B	23.12B	21.86B	17.85B	17.59B
Stockholders Equity	23.03B	21.34B	19.12B	17.58B	18.00B	17.72B
Cash Flow
Free Cash Flow	2.46B	2.26B	1.63B	-983.71M	-818.54M	-472.14M
Operating Cash Flow	2.46B	2.26B	1.63B	1.66B	1.70B	1.71B
Investing Cash Flow	-1.98B	-1.91B	-1.12B	-4.70B	-1.06B	-2.60B
Financing Cash Flow	902.83M	2.06B	963.47M	2.97B	-590.63M	935.69M

Digital Realty Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 169.89
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DLR, the sentiment is Neutral. The current price of 169.89 is below the 20-day moving average (MA) of 172.12, below the 50-day MA of 171.16, and above the 200-day MA of 164.19, indicating a neutral trend. The MACD of -0.93 indicates Positive momentum. The RSI at 47.28 is Neutral, neither overbought nor oversold. The STOCH value of 21.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DLR.

Digital Realty Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KRC	72 Outperform	$5.19B	16.04	5.94%	4.97%	0.77%	62.58%
DLR	70 Outperform	$58.36B	43.89	6.32%	2.90%	7.75%	216.77%
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
CUZ	63 Neutral	$4.39B	75.43	1.26%	4.89%	16.38%	3.60%
BXP	61 Neutral	$12.60B	―	-3.74%	5.03%	2.54%	-155.17%
VNO	57 Neutral	$7.77B	8.86	15.97%	1.99%	2.41%	―
ARE	48 Neutral	$9.19B	―	-2.42%	9.49%	-0.76%	-250.60%

Digital Realty Corporate Events

Digital Realty Trust’s Optimistic Earnings Call Highlights

Digital Realty Trust’s recent earnings call conveyed a cautiously optimistic sentiment, underscored by a record financial performance. The company reported a strong increase in funds from operations (FFO), a robust backlog, and significant AI-related bookings. However, challenges such as power availability, rising operational costs, and impending debt maturities were also highlighted. Despite these hurdles, the positive aspects slightly outweighed the negatives, leaving an overall optimistic outlook.

Digital Realty Trust Reports Strong Q3 2025 Results

Digital Realty Trust, Inc. is a leading global provider of data center, colocation, and interconnection solutions, catering to a diverse range of industries including cloud services, IT, communications, and financial services. The company operates over 300 data centers worldwide, offering critical infrastructure for technology and corporate enterprises.

Digital Realty Releases Q3 2025 Financial Results

On October 23, 2025, Digital Realty announced its financial results for the quarter ending September 30, 2025. The company released supplemental information and presentation materials on its website, reflecting its ongoing commitment to transparency and stakeholder engagement. This announcement is likely to impact the company’s operations and industry positioning by providing stakeholders with critical insights into its financial health and strategic direction.

The most recent analyst rating on (DLR) stock is a Buy with a $210.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.

Digital Realty Approves 2025 Carried Interest Plan

On August 27, 2025, Digital Realty Trust, Inc. approved the Digital Realty 2025 Carried Interest Plan to incentivize and retain key employees through carried interest and appreciation interest awards. This plan aims to recognize the success of strategic capital ventures and involves granting awards to executives, including the CEO and CFO, with specific carried interest percentages. The plan’s implementation highlights Digital Realty’s commitment to aligning employee incentives with the company’s strategic goals, potentially impacting its market positioning by fostering employee engagement and investment success.

The most recent analyst rating on (DLR) stock is a Buy with a $185.00 price target. To see the full list of analyst forecasts on Digital Realty stock, see the DLR Stock Forecast page.