We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Equinix (EQIX) & PGIM Open First xScale Data Center in Sydney
Read MoreHide Full Article
Equinix, Inc. (EQIX - Free Report) and PGIM Real Estate recently unveiled the first xScale data center in Sydney, named SY9x, for hyperscalers. This move follows the completion of their $575 million joint venture agreement earlier in March 2022.
Shares of this data center real estate investment trust (REIT) closed at $618.51, witnessing marginal gains in the Jun 14 trading session following the announcement.
PGIM Real Estate and Equinix own 80% and 20% equity interest in the joint venture, respectively, with the latter being responsible for operating the hyperscale data centers.
The joint venture in Australia comes as part of Equinix’ xScale portfolio expansion efforts. Its global xScale data center portfolio investment is expected to cross $8 billion in 36 facilities. Also, more than 720 megawatts (MW) of power capacity is anticipated to be generated upon completion of the project.
SY9x, which presently offers more than 14 MW of power capacity, is well-positioned in Rosehill, adjacent to the Western Sydney CBD of Parramatta. SY9x is expected to deliver more than 28 MW of power capacity when fully built. In addition, a second xScale facility, to be named SY10x, will be set up with a power capacity of more than 28 MW. Jointly, these two xScale facilities will have a power capacity of more than 55MW to serve the rising demand for cloud-based platforms and services among businesses in Australia.
Equinix presently operates nine xScale data centers across all three regions — SY9x in Sydney, FR9x in Frankfurt, LD11x and LD13x in London, OS2x in Osaka, PA8x and PA9x in Paris, SP5x in São Paulo, and TY12x in Tokyo. Eight xScale projects underway with an incremental capacity of roughly 70 MW.
Equinix is well-poised to bank on the cloud computing market in Australia, which is expected to expand 12.5% and reach $14.1 billion in 2025, backed by large-scale digital transformation initiatives across both the public and private sectors. Further, according to Global Interconnection Index Volume 5 (GXI Vol. 5), a market survey by EQIX forecasts Sydney to witness a 43% compound annual growth rate (CAGR) for enterprise private interconnection to the cloud and IT providers between 2020 and 2024. This is one of the highest in the Asia-Pacific region.
Moreover, Equinix has established joint ventures in the Asia-Pacific region to build xScale data centers in Seoul, Osaka and Tokyo. The company intends to build 10 xScale data centers in the region, including Sydney. This is estimated to generate around 240 MW of power capacity upon execution.
The demand for high-performing data centers will escalate in the coming years amid high growth in cloud computing, the Internet of Things and big data and elevated demand for third-party IT infrastructure. Growth in artificial intelligence, as well as autonomous vehicle and virtual/augmented reality markets, is anticipated to be robust over the next five-six years, providing excellent growth opportunities for this data center REIT.
Equinix is focused on tapping such growth opportunities with its expansionary efforts. In April 2022, it closed the acquisition of MainOne, thereby extending its reach to Africa. Moreover, in May 2022, the company acquired four data centers in Chile from a leading telecommunications provider, Empresa Nacional De Telecomunicaciones S.A. (Entel).
The Zacks Consensus Estimate for Prologis’ 2022 FFO per share has moved 1.8% upward in the past two months to $5.15. PLD presently carries a Zacks Rank of 2 (Buy).
The Zacks Consensus Estimate for Rexford Industrial Realty’s ongoing year’s FFO per share has been raised 1% over the past two months to $1.93. REXR carries a Zacks Rank #2, currently.
The Zacks Consensus Estimate for OUTFRONT Media’s current-year FFO per share has moved 51.5% northward in the past two months to $2.09. OUT sports a Zacks Rank of 1 at present.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Equinix (EQIX) & PGIM Open First xScale Data Center in Sydney
Equinix, Inc. (EQIX - Free Report) and PGIM Real Estate recently unveiled the first xScale data center in Sydney, named SY9x, for hyperscalers. This move follows the completion of their $575 million joint venture agreement earlier in March 2022.
Shares of this data center real estate investment trust (REIT) closed at $618.51, witnessing marginal gains in the Jun 14 trading session following the announcement.
PGIM Real Estate and Equinix own 80% and 20% equity interest in the joint venture, respectively, with the latter being responsible for operating the hyperscale data centers.
The joint venture in Australia comes as part of Equinix’ xScale portfolio expansion efforts. Its global xScale data center portfolio investment is expected to cross $8 billion in 36 facilities. Also, more than 720 megawatts (MW) of power capacity is anticipated to be generated upon completion of the project.
SY9x, which presently offers more than 14 MW of power capacity, is well-positioned in Rosehill, adjacent to the Western Sydney CBD of Parramatta. SY9x is expected to deliver more than 28 MW of power capacity when fully built. In addition, a second xScale facility, to be named SY10x, will be set up with a power capacity of more than 28 MW. Jointly, these two xScale facilities will have a power capacity of more than 55MW to serve the rising demand for cloud-based platforms and services among businesses in Australia.
Equinix presently operates nine xScale data centers across all three regions — SY9x in Sydney, FR9x in Frankfurt, LD11x and LD13x in London, OS2x in Osaka, PA8x and PA9x in Paris, SP5x in São Paulo, and TY12x in Tokyo. Eight xScale projects underway with an incremental capacity of roughly 70 MW.
Equinix is well-poised to bank on the cloud computing market in Australia, which is expected to expand 12.5% and reach $14.1 billion in 2025, backed by large-scale digital transformation initiatives across both the public and private sectors. Further, according to Global Interconnection Index Volume 5 (GXI Vol. 5), a market survey by EQIX forecasts Sydney to witness a 43% compound annual growth rate (CAGR) for enterprise private interconnection to the cloud and IT providers between 2020 and 2024. This is one of the highest in the Asia-Pacific region.
Moreover, Equinix has established joint ventures in the Asia-Pacific region to build xScale data centers in Seoul, Osaka and Tokyo. The company intends to build 10 xScale data centers in the region, including Sydney. This is estimated to generate around 240 MW of power capacity upon execution.
The demand for high-performing data centers will escalate in the coming years amid high growth in cloud computing, the Internet of Things and big data and elevated demand for third-party IT infrastructure. Growth in artificial intelligence, as well as autonomous vehicle and virtual/augmented reality markets, is anticipated to be robust over the next five-six years, providing excellent growth opportunities for this data center REIT.
Equinix is focused on tapping such growth opportunities with its expansionary efforts. In April 2022, it closed the acquisition of MainOne, thereby extending its reach to Africa. Moreover, in May 2022, the company acquired four data centers in Chile from a leading telecommunications provider, Empresa Nacional De Telecomunicaciones S.A. (Entel).
EQIX currently carries a Zacks Rank #3 (Hold). Shares of Equinix have declined 12.1% in the past three months compared with the real estate market’s fall of 16.6% You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are Prologis (PLD - Free Report) , Rexford Industrial Realty (REXR - Free Report) and OUTFRONT Media (OUT - Free Report) .
The Zacks Consensus Estimate for Prologis’ 2022 FFO per share has moved 1.8% upward in the past two months to $5.15. PLD presently carries a Zacks Rank of 2 (Buy).
The Zacks Consensus Estimate for Rexford Industrial Realty’s ongoing year’s FFO per share has been raised 1% over the past two months to $1.93. REXR carries a Zacks Rank #2, currently.
The Zacks Consensus Estimate for OUTFRONT Media’s current-year FFO per share has moved 51.5% northward in the past two months to $2.09. OUT sports a Zacks Rank of 1 at present.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.