Digital Core REIT (DCRU) AI Stock Analysis

• Market Cap: $599.84M
• Dividend Yield: 7.77%
• Average Volume (3M): 4.07M
• Price to Earnings (P/E): 3.1
• Beta (1Y): 0.80
• Revenue Growth: 36.48%
• EPS Growth: N/A
• Country: SG
• Employees: 3,000
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Specialty
• EPS (TTM): <0.01
• Shares Outstanding: 1,304,009,900
• 10 Day Avg. Volume: 5,130,650
• 30 Day Avg. Volume: 4,074,662
• PEG Ratio: -0.01
• Price to Book (P/B): 0.72
• Price to Sales (P/S): 7.37
• P/FCF Ratio: 13.46
• Enterprise Value/Market Cap: 2.82
• Enterprise Value/Revenue: 12.88
• Enterprise Value/Gross Profit: 29.16
• Enterprise Value/Ebitda: 88.02
• 1Y Price Target: $0.63
• Price Target Upside: 36.96% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 71 Outperform
• Price Target: $0.50 ▲(8.70% Upside)

Digital Core REIT's strong financial performance and attractive valuation are the primary drivers of its overall score. The company's robust profitability and cash flow generation capabilities provide a solid foundation, while the low P/E ratio and high dividend yield enhance its attractiveness. Technical indicators suggest some caution in the short term, but the stock's long-term prospects remain positive.

Positive Factors

Cash Generation

Strong cash generation supports operational stability and provides flexibility for reinvestment and debt management, crucial for long-term growth.

Profitability

A significant improvement in net profit margin indicates a successful turnaround in profitability, enhancing the company's financial health and investor confidence.

Operational Performance

Strong EBIT and EBITDA margins reflect efficient operations and cost management, providing a solid foundation for sustained profitability and competitive advantage.

Negative Factors

Revenue Decline

A decline in revenue growth can hinder long-term expansion and market competitiveness, necessitating strategic adjustments to reverse the trend.

Financial Leverage

Moderate financial leverage could limit financial flexibility and increase risk, especially in volatile market conditions, impacting long-term stability.

Revenue Growth Challenges

Persistent revenue challenges may affect future profitability and growth potential, requiring strategic initiatives to boost revenue streams.

Digital Core REIT Business Overview & Revenue Model

Company Description

Digital Core REIT, a real estate investment trust, engages in the development, acquisition, ownership, and operation of data centres. It has 10 mission-critical data centres located in the United States and Canada. The company was incorporated in 2021 and is based in Singapore.

How the Company Makes Money

Digital Core REIT makes money primarily through leasing its portfolio of data center properties to tenants, which include technology companies, cloud service providers, and enterprises requiring data storage and processing capabilities. The company generates revenue from rental income, which typically comes from long-term lease agreements that provide stable and predictable cash flows. Additionally, Digital Core REIT may engage in strategic partnerships or joint ventures to enhance its property portfolio and capitalize on emerging trends in the data center industry. Significant factors contributing to its earnings include the increasing demand for data storage and processing space driven by the growth of digital services, cloud computing, and the internet of things (IoT).

Digital Core REIT Financial Statement Overview

Summary

Digital Core REIT presents a robust financial position with strong profitability metrics despite a recent decline in revenue. The balance sheet reflects moderate leverage with a stable capital structure, while cash flow generation remains solid, supporting operational stability. Continued focus on revenue growth and managing leverage would further enhance financial health.

Income Statement

The income statement shows a strong gross profit margin of 54.13% in the latest year, reflecting efficient cost management. The net profit margin improved significantly to 200.87% from a negative margin in the previous year, indicating a turnaround in profitability. However, the revenue growth rate was -5.91%, suggesting a decline in revenue which is a concern. EBIT and EBITDA margins are healthy at 50.56% and 319.86%, respectively, showcasing strong operational performance.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 0.63, indicating moderate financial leverage, though manageable for a REIT. The return on equity is notably high at 19.67%, suggesting efficient use of equity to generate profits. The equity ratio is 51.82%, indicating a stable capital structure with a good proportion of assets financed by equity.

Cash Flow

Cash flow analysis shows a positive free cash flow growth rate of 36.85%, indicating strong cash generation capabilities. The operating cash flow to net income ratio is 0.27, which suggests that operating cash flow covers a significant portion of net income. The free cash flow to net income ratio is 0.27, highlighting consistent cash flow performance despite fluctuations in net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2020	Dec 2019
Income Statement
Total Revenue	131.23M	102.27M	108.70M	116.49M	76.62M	78.75M
Gross Profit	57.95M	55.37M	61.72M	76.47M	31.88M	44.11M
EBITDA	19.20M	327.21M	-101.67M	29.91M	53.22M	42.22M
Net Income	208.43M	205.38M	-108.58M	1.54M	29.54M	18.40M
Balance Sheet
Total Assets	2.22B	2.01B	1.51B	1.61B	1.45B	0.00
Cash, Cash Equivalents and Short-Term Investments	60.72M	44.12M	12.10M	26.66M	4.00M	0.00
Total Debt	797.26M	653.84M	555.49M	495.03M	348.07M	0.00
Total Liabilities	907.14M	735.29M	589.41M	535.54M	355.58M	0.00
Stockholders Equity	1.06B	1.04B	790.48M	934.89M	949.51M	0.00
Cash Flow
Free Cash Flow	0.00	56.03M	40.93M	76.22M	41.40M	0.00
Operating Cash Flow	0.00	56.03M	40.93M	76.22M	54.75M	0.00
Investing Cash Flow	0.00	-45.67M	-50.91M	-1.45B	-936.33M	0.00
Financing Cash Flow	0.00	20.09M	-3.59M	1.41B	909.81M	0.00

Digital Core REIT Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.46
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:DCRU, the sentiment is Negative. The current price of 0.46 is below the 20-day moving average (MA) of 0.49, below the 50-day MA of 0.50, and below the 200-day MA of 0.51, indicating a bearish trend. The MACD of -0.01 indicates Positive momentum. The RSI at 22.44 is Positive, neither overbought nor oversold. The STOCH value of -6.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SG:DCRU.

Digital Core REIT Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ODBU	74 Outperform	$302.73M	10.44	6.49%	8.30%	-1.34%	-6.08%
DCRU	71 Outperform	$599.84M	3.06	20.33%	7.77%	36.48%	―
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
CMOU	61 Neutral	$240.22M	―	-2.12%	24.56%	-1.55%	78.22%
UD1U	56 Neutral	S$390.00M	29.59	1.69%	8.52%	-11.29%	―
OXMU	46 Neutral	$280.30M	92.86	0.38%	1.80%	-12.01%	―

Digital Core REIT Corporate Events

Digital Core REIT Issues Units for Management Fee Payment

Digital Core REIT has announced the issuance of 5,466,196 units at a price of US$0.5800 per unit as payment for its management fee for the second half of 2023. This move, as per the company’s trust deed, allows the management fee to be paid in units, increasing the company’s total unitholding to 24,610,396 units, which is approximately 1.887% of the total issued units. The issuance reflects the company’s strategic approach to managing its financial obligations and maintaining its stake within the REIT.

The most recent analyst rating on (SG:DCRU) stock is a Hold with a $0.50 price target. To see the full list of analyst forecasts on Digital Core REIT stock, see the SG:DCRU Stock Forecast page.

Digital Core REIT Reports Strong Mid-Year Performance and Strategic Expansion

Digital Core REIT announced a distribution of 1.80 U.S. cents and reported improved portfolio occupancy to 98.0% due to positive net absorption. The acquisition of a 20% interest in a second data center in Osaka is expected to enhance the company’s geographic diversification and increase revenue contribution from Japan, making Osaka its fourth-largest market. This acquisition also improves portfolio quality with a state-of-the-art facility leased to investment-grade customers, primarily global cloud providers.

The most recent analyst rating on (SG:DCRU) stock is a Buy with a $0.70 price target. To see the full list of analyst forecasts on Digital Core REIT stock, see the SG:DCRU Stock Forecast page.

Digital Core REIT Announces Tax-Efficient Distribution

Digital Core REIT has announced a distribution of 1.80 U.S. cents per unit to its stakeholders, with the payment scheduled for September 18, 2025. The distribution is not subject to U.S. withholding tax as it is not connected to a U.S. trade or business, highlighting the company’s strategic positioning to optimize returns for its investors while navigating international tax regulations.

The most recent analyst rating on (SG:DCRU) stock is a Buy with a $0.70 price target. To see the full list of analyst forecasts on Digital Core REIT stock, see the SG:DCRU Stock Forecast page.

Digital Core REIT Issues Qualified Notice on Transfer of Interests

Digital Core REIT has issued a Qualified Notice regarding the transfer of interests, confirming that it is not engaged in any trade or business within the United States. This announcement ensures that certain withholding exceptions apply, potentially impacting stakeholders by clarifying tax obligations related to the transfer of interests in the REIT.

The most recent analyst rating on (SG:DCRU) stock is a Buy with a $0.75 price target. To see the full list of analyst forecasts on Digital Core REIT stock, see the SG:DCRU Stock Forecast page.