Digital Realty Trust, Inc. (DLR), headquartered in Austin, Texas, connects companies and data through a comprehensive range of data center, colocation, and interconnection solutions. Valued at $55.8 billion by market cap, the company connects customers to global data communities through 300+ facilities in 50+ metros across 25+ countries, as well as it operates PlatformDIGITAL that offers a secure, scalable solution for managing data gravity challenges.
Shares of this leading global data center REIT have underperformed the broader market over the past year. DLR has gained 15.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 20.6%. In 2025, DLR stock is down 5.2%, compared to SPX’s 2.5% rise on a YTD basis.
Narrowing the focus, DLR’s underperformance is also apparent compared to iShares U.S. Digital Infrastructure and Real Estate ETF (IDGT). The exchange-traded fund has gained about 20% over the past year. Moreover, the ETF’s 2.8% gains on a YTD basis outshine the stock’s losses over the same time frame.
DLR's stock slipped around 10% amid concerns that DeepSeek's energy-efficient AI model could reduce demand for data centers. Additionally, concerns that Trump-era policies could fuel inflation, leading to prolonged high interest rates have led to its underperformance.
On Oct. 24,DLR reported its Q3 results, and its shares closed up more than 9% in the following trading session. Its core FFO of $1.67 matched the Wall Street expectations. The company’s revenue was $1.43 billion, missing the Wall Street forecasts of $1.44 billion. DLR expects full-year core FFO to be between $6.65 and $6.75.
For the current fiscal year, ended in December 2024, analysts expect DLR’s FFO to grow 1.8% to $6.71 on a diluted basis. The company’s earnings surprise history is mixed. It beat or matched the consensus estimates in three of the last four quarters while missing the forecast on another occasion.
Among the 26 analysts covering DLR stock, the consensus is a “Moderate Buy.” That’s based on 17 “Strong Buy” ratings, one “Moderate Buy,” seven “Holds,” and one “Strong Sell.”
This configuration is more bullish than a month ago, with 15 analysts suggesting a “Strong Buy.”
On Feb. 9, JMP Securities analyst Gregory J Miller reaffirmed a “Buy” rating on DLR with a price target of $220, implying a potential upside of 30.9% from current levels.
The mean price target of $189.25 represents a 12.6% premium to DLR’s current price levels. The Street-high price target of $226 suggests an ambitious upside potential of 34.5%.
