BofA update shows where active managers are putting money
Investing.com - CFRA downgraded Equinix (NASDAQ:EQIX) from Buy to Hold on Thursday, while maintaining its $850 price target for the data center real estate investment trust. The stock, currently trading at $787.05, sits between its 52-week range of $701.41 to $994.03. According to InvestingPro analysis, Equinix appears overvalued at current levels.
The research firm cited a more conservative risk assessment for the downgrade, despite acknowledging global market growth opportunities for data centers. CFRA’s price target reflects a forward price-to-funds from operations (P/FFO) multiple of 27.9x. InvestingPro data shows Equinix maintains a GOOD overall financial health score, with particularly strong cash flow metrics.
The firm noted its valuation approach is reasonable compared to other REIT property types, which typically trade at P/FFO multiples in the mid to upper teens. CFRA’s target remains significantly below the consensus target of $953, with analyst targets ranging from $798 to $1,200. The stock currently trades at a P/E ratio of 81.6x.
CFRA increased its 2025 FFO estimate by $0.25 to $27.75 while maintaining its 2026 estimate at $30.50, in line with consensus. The firm projects revenue of $9.3 billion in 2025 and $10.0 billion in 2026.
The downgrade reflects CFRA’s more conservative outlook for 2025-2026, questioning whether Equinix will capture an outsized share of the global data center market growth driven by cloud and AI enterprise customers.
In other recent news, Equinix reported a 5% year-over-year revenue increase in its Q2 2025 earnings call, reaching $2.26 billion. The company also achieved an adjusted EBITDA margin of 50%, reflecting strong financial performance. Equinix updated its 2025 revenue guidance to a growth range of 7-8%, driven by robust demand for its digital infrastructure services. Following these results, JPMorgan raised its price target for Equinix to $940, maintaining an Overweight rating due to the company’s solid second-quarter performance. Equinix exceeded analyst expectations in adjusted EBITDA and AFFO metrics, benefiting from better-than-expected non-recurring revenue. Additionally, JMP Securities reiterated its Market Outperform rating with a price target of $1,200, highlighting the clarification of the company’s capital expenditure plans that had previously concerned investors. These developments underscore Equinix’s strategic expansions and financial stability in the current market landscape.
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