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Digital Realty (DLR) Introduces PoPs at APAC Data Centers
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Digital Realty (DLR - Free Report) recently announced the deployment of points of presence (PoPs) at its data centers in Singapore, Hong Kong and Sydney by Hurricane Electric, the world's largest IPv4 and IPv6-native Internet backbone. The move extends their global relationship to the Asia Pacific (APAC) region.
Given the rising demand for on-demand video, mobile gaming and online content, APAC is now the fastest-developing region for data center colocation in the world. Hence, DLR’s latest move is a strategic fit.
Digital Realty's customers will now be able to connect directly to Hurricane Electric's extensive IPv4 and IPv6 network through 100GE (100 Gigabit Ethernet), 10GE (10 Gigabit Ethernet) and GigE (1 Gigabit Ethernet) ports.
Moreover, without having to upgrade their last-mile network connection, customers will be able to access a rich, connected data community with over 4,000 customers in 53 metros across 27 countries on six continents.
The partnership also facilitates the exchange of IP traffic with Hurricane Electric's vast global network, which offers over 30,000 BGP sessions with more than 10,000 different networks through more than 280 major exchange points, thousands of customers and private peering ports.
Hence, the deployment of PoPs provides customers scope to capitalize on Hurricane Electric's high-speed IP transit network that reduces latency, improves traffic flow and increases the efficiency of their data networks.
Furthermore, Digital Realty's global data center platform, PlatformDIGITAL®, will provide customers with a secure meeting place through which they can access extensive centers of data exchange required to scale their digital businesses and overcome the barriers related to data gravity (challenge of moving data at scale).
Per Govind Choudhary, head of service provider and market strategy, APAC, Digital Realty, “This extension of PlatformDIGITAL® across Asia Pacific through Hurricane Electric's global network connectivity will further enhance Digital Realty's position as an industry leading interconnection platform.”
The demand for high-performing data centers is expected to increase in the coming years, owing to the escalation in cloud computing, the Internet of Things and big data, and the rising demand for third-party IT infrastructure.
Growth in the artificial intelligence, autonomous vehicle and virtual/augmented reality markets is expected to gain pace over the next five to six years. Digital Realty is likely to capitalize on this upbeat trend, which will aid its long-term growth.
However, given the strong growth potential of the industry, intense competition from existing and new players in the space could prompt competitors to resort to aggressive pricing policies, making DLR vulnerable to pricing pressure. Also, rising interest rates add to the company’s concerns.
DLR currently carries a Zacks Rank #4 (Sell).
Its shares have gained 9.4% in the past three months compared with the industry’s growth of 10.3%.
Image: Bigstock
Digital Realty (DLR) Introduces PoPs at APAC Data Centers
Digital Realty (DLR - Free Report) recently announced the deployment of points of presence (PoPs) at its data centers in Singapore, Hong Kong and Sydney by Hurricane Electric, the world's largest IPv4 and IPv6-native Internet backbone. The move extends their global relationship to the Asia Pacific (APAC) region.
Given the rising demand for on-demand video, mobile gaming and online content, APAC is now the fastest-developing region for data center colocation in the world. Hence, DLR’s latest move is a strategic fit.
Digital Realty's customers will now be able to connect directly to Hurricane Electric's extensive IPv4 and IPv6 network through 100GE (100 Gigabit Ethernet), 10GE (10 Gigabit Ethernet) and GigE (1 Gigabit Ethernet) ports.
Moreover, without having to upgrade their last-mile network connection, customers will be able to access a rich, connected data community with over 4,000 customers in 53 metros across 27 countries on six continents.
The partnership also facilitates the exchange of IP traffic with Hurricane Electric's vast global network, which offers over 30,000 BGP sessions with more than 10,000 different networks through more than 280 major exchange points, thousands of customers and private peering ports.
Hence, the deployment of PoPs provides customers scope to capitalize on Hurricane Electric's high-speed IP transit network that reduces latency, improves traffic flow and increases the efficiency of their data networks.
Furthermore, Digital Realty's global data center platform, PlatformDIGITAL®, will provide customers with a secure meeting place through which they can access extensive centers of data exchange required to scale their digital businesses and overcome the barriers related to data gravity (challenge of moving data at scale).
Per Govind Choudhary, head of service provider and market strategy, APAC, Digital Realty, “This extension of PlatformDIGITAL® across Asia Pacific through Hurricane Electric's global network connectivity will further enhance Digital Realty's position as an industry leading interconnection platform.”
The demand for high-performing data centers is expected to increase in the coming years, owing to the escalation in cloud computing, the Internet of Things and big data, and the rising demand for third-party IT infrastructure.
Growth in the artificial intelligence, autonomous vehicle and virtual/augmented reality markets is expected to gain pace over the next five to six years. Digital Realty is likely to capitalize on this upbeat trend, which will aid its long-term growth.
However, given the strong growth potential of the industry, intense competition from existing and new players in the space could prompt competitors to resort to aggressive pricing policies, making DLR vulnerable to pricing pressure. Also, rising interest rates add to the company’s concerns.
DLR currently carries a Zacks Rank #4 (Sell).
Its shares have gained 9.4% in the past three months compared with the industry’s growth of 10.3%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the REIT sector are VICI Properties (VICI - Free Report) , Alexandria Real Estate Equities (ARE - Free Report) and Stag Industrial (STAG - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for VICI Properties’ current-year FFO per share is pegged at $1.92.
The Zacks Consensus Estimate for Alexandria Real Estate’s 2022 FFO per share stands at $8.41.
The Zacks Consensus Estimate for Stag Industrial’s 2022 FFO per share is pegged at $2.21.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.