Digital Realty Draws Institutional Inflows After Guidance Shift and Revenue Beat

Institutional investors have continued to adjust their positions in Digital Realty Trust, Inc. (NYSE: DLR). In a recent regulatory disclosure, Aew Capital Management Inc. revealed a new position of 490,813 shares acquired in the third quarter, valued at approximately $86,152,000. The stake makes the data center real estate investment trust its fourth-largest holding at about 5.7% of its portfolio. Overall, institutional investors and hedge funds hold 99.71% of the company's outstanding stock.

The institutional activity follows the company's earnings report from Thursday, October 29th. Digital Realty reported third-quarter revenue of $1.90 billion, rising 20.6% year over year and topping consensus projections of $1.75 billion. Simply Wall St noted quarterly net income of US$195.35 million. However, adjusted earnings came in at $0.48 per share, missing consensus expectations of $0.52 per share and declining from $1.89 per share posted in the prior-year period.

Following the financial results, Digital Realty raised its full-year top-line revenue outlook. At the same time, the company trimmed its projected net income per diluted share to US$2.90 to US$2.95, according to Simply Wall St. The shift in expectations coincides with heavier investments and expenses, including ongoing mergers and acquisitions and global expansion of its 1.4 GW development pipeline.

Wall Street analysts hold a consensus Moderate Buy rating on the REIT, with 28 rating it a Buy or Strong Buy and six assigning a Hold rating, according to MarketBeat. Freedom Broker recently trimmed its target price from $233.00 to $227.00 while maintaining a buy rating, whereas the consensus target stands at $221.53. In addition, GuruFocus highlighted that the stock carries a GF Score of 87 out of 100 with an intrinsic GF Value estimate of $187.00, balanced against a negative free cash flow yield of -2.2%.

Digital Realty shares opened at $181.15 on Thursday. The stock's 52-week trading range stands between $146.23 and $208.14, with a market capitalization of $68.54 billion.