Digital Realty Trust, Inc. (DLR - Free Report) is offering direct, private access to Salesforce platform, the leading CRM solution worldwide, through Digital Realty Service Exchange in 15 metros worldwide. The move comes as part of the company’s effort to grow its business and lure customers.
Particularly, this access to Salesforce is being offered in Amsterdam, Ashburn, Atlanta, Boston, Chicago, Frankfurt, Dallas, London and Los Angeles. Also, it is available with immediate effect in Miami, New York, Phoenix, Portland, San Francisco Bay Area and Seattle.
Notably, direct access to SaaS applications is beneficial over connectivity through the Internet and Digital Realty's Service Exchange offers enterprises a direct connection to IaaS, PaaS and SaaS providers. There are solid advantages because it helps minimize latency and also enables customers to enhance scalability at a rapid pace, and efficiently from a single cabinet to a multi-megawatt facility.
In fact, more than 30% of organizations will connect to cloud providers using alternatives to the public internet, per a Gartner recent report cited by the company. This marks a significant increase from 5% reported in third-quarter 2017.
Data-center REITs will likely continue experiencing a boom market, with growth in cloud computing, Internet of Things and big data, and an increasing number of companies opting for third-party IT infrastructure. Also, the estimated growth rates for the artificial intelligence, autonomous vehicle and virtual/augmented reality markets will remain robust over the next five-eight years.
These factors, along with an improved outlook for economic growth, are anticipated to substantially drive growth of data-center REITs, including Digital Realty, Equinix, Inc. (EQIX - Free Report) , CyrusOne Inc. (CONE - Free Report) , CoreSite Realty Corporation (COR - Free Report) and others.
Particularly, Digital Realty is poised to benefit from this solid demand for data centers through accretive acquisitions and development efforts. The company also focuses on maintaining an investment-grade balance sheet, enjoys ample liquidity and has a well-laddered debt maturity schedule. Nevertheless, aggressive pricing pressure is likely to continue in the near future. Moreover, the company has a substantial debt burden and hence, rate hike adds to its woes.
Shares of Digital Realty have outperformed the industry it belongs to, in the past three months. The stock has gained 13.4%, while the industry has rallied 2.3%.
Digital Realty currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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