Digital Realty Trust price target raised to $191 from $177 at Mizuho

Mizuho (NYSE:MFG) raised its price target on Digital Realty Trust (NYSE:DLR) stock to $191 from $177 on Tuesday, while maintaining an Outperform rating on the data center real estate investment trust. The stock, currently trading at $176.06, has shown strong momentum with a 21.7% return over the past year. According to InvestingPro analysis, the company appears to be trading above its Fair Value.

The research firm cited "strong bookings and potential upside from the fund" as key factors supporting the higher valuation target for the company. The company maintains a solid financial position with a current ratio of 1.66, indicating strong liquidity, and has maintained dividend payments for 22 consecutive years.

Mizuho analyst Omotayo Okusanya explained the new price target is based on applying a 27x AFFO (adjusted funds from operations) multiple to FY26E AFFO, compared to the prior multiple of 26x.

The analyst noted that while the AFFO multiple aligns with current levels, it represents an increase compared to historical valuations for Digital Realty Trust.

Mizuho believes this higher multiple "is warranted due to strong bookings and potential upside from the fund," according to the research note published Tuesday morning.

In other recent news, Digital Realty Trust reported its first-quarter 2025 financial results, highlighting a 6% year-over-year increase in core funds from operations (FFO) per share to $1.77 and a 7% rise in data center revenue. The company also raised its full-year core FFO guidance to a range of $7.05-$7.15 per share, reflecting confidence in continued growth. Despite missing earnings per share forecasts, analysts from Stifel maintained a Buy rating, citing strong leasing performance and a robust pipeline of deals, while JMP Securities reiterated a Market Outperform rating, adjusting revenue projections due to foreign exchange headwinds. Additionally, Digital Realty announced its second-quarter dividends for 2025, declaring $1.22 per share for common stockholders. The company held its Annual Meeting of Stockholders, where all director nominees were elected, and key proposals such as the ratification of KPMG LLP as the independent auditor were approved. A stockholder proposal regarding the human right to water did not pass. These developments reflect Digital Realty’s strategic direction and investor confidence in its growth prospects.

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