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Investing.com - Stifel lowered its price target on Equinix (NASDAQ:EQIX) stock to $1,010 from $1,050 on Thursday while maintaining a Buy rating on the data center company. The stock, currently trading at $824.31, sits well below its 52-week high of $994.03, with analysts maintaining an overall bullish consensus. According to InvestingPro analysis, the company currently appears overvalued based on its Fair Value metrics.
The price target reduction follows Equinix’s analyst day where management outlined long-term growth targets of 7%-10% for annual revenue through 2029. The company’s adjusted funds from operations per share (AFFO/sh) growth target of 5%-9% came in below expectations. With a market capitalization of $81 billion and a solid Financial Health Score rated as "GOOD" by InvestingPro, Equinix maintains strong fundamentals despite near-term headwinds.
Stifel noted that Equinix’s AFFO growth will be impacted by an accelerated capital plan that includes $1.5 billion to $2.0 billion in incremental annual spending, along with higher borrowing costs on new investments and refinancing activity.
The research firm specifically pointed to 2026 and 2027 as years that will see impact from "expansion drag" due to the timing gap between investments and when new sites begin generating revenue.
Despite the near-term challenges, Stifel remains positive on Equinix’s long-term prospects, citing "robust" artificial intelligence opportunities and the company’s adapted strategy to "build bolder to capture this AI momentum."
In other recent news, Equinix has outlined several significant developments following its 2025 Analyst Day. The company has reduced its long-term revenue guidance and adjusted funds from operations (AFFO) per share targets, prompting KeyBanc to maintain a Sector Weight rating due to concerns over decelerating growth and rising capital expenditures. Scotiabank (TSX:BNS) and Jefferies both lowered their price targets for Equinix to $965 and $940, respectively, citing increased capital expenditures related to artificial intelligence and digital infrastructure investments. Despite these challenges, Scotiabank and Jefferies continue to hold positive long-term views, maintaining Sector Outperform and Buy ratings.
Evercore ISI also maintained its Outperform rating, despite Equinix’s lowered AFFO per share growth outlook for 2025-2029. The company anticipates a 5%-9% compound annual growth rate in AFFO per share through 2029, with substantial investments in AI and infrastructure. Equinix aims to double its capacity by 2029, driven by a $250 billion total addressable market. Goldman Sachs reiterated its Buy rating and $1,020 price target, noting the company’s aggressive investment plans to capture AI revenue opportunities, though it highlighted the lack of near-term catalysts. Equinix’s strategic focus on AI and infrastructure suggests a long-term growth trajectory, despite near-term financial pressures.
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