NYSE (DLR)
A Roots Research Publication QX 20XX
As of XX/XX/2023
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WHY WE ARE TALKING ABOUT THIS STOCK
Top Tenants
● Digital Realty (NYSE: DLR) is the largest global provider of cloud and carrier-neutral data center, colocation and interconnection solutions with 316 data centers as of June 30th, 2023. ● Consistent history of historically increasing quarterly dividends since 2004. ● Digital Realty authorized a quarterly cash dividend of $1.22 per share to common stockholders with a record date of the close of business on September 15th, and is payable on September 29th, 2023. ● DLR reported $1.4 billion in revenue for Q2FY23, which represents a 2% increase quarter-over-quarter and a 20% increase year-over-year. ● As of June 30, 2023, Digital Realty had approximately $17.7 billion in total debt, with $17.2 billion in unsecured debt and around $0.5 billion in secured debt and other obligations. ● Digital Realty revised its 2023 Core FFO per share and constant-currency Core FFO per share forecast to a range of $6.55 to $6.65.
● Fortune 50
Software Company ● IBM ● Social Content Platform ● Oracle Corporation ● Global Cloud Provider ● Fortune 25 Investment Grade-Rated Company ● Equinix ● LinkedIn Corporation ● Meta Platforms, Inc. ● Fortune 25 Tech Company ● Fortune 500 SaaS Provider ● Cyxtera
Digital Realty returns capital to shareholders in the form of a quarterly cash dividend. However, the Company also has an ongoing $1.5 billion at-the-money primary offering.
Industry
Sector
REIT - Specialty
Real Estate
ABOUT THE COMPANY ● SHARES OUTSTANDING*: ○ 302,709,295 ● LOCATION: ○ Austin, Texas ● MISSION STATEMENT FROM PROSPECTUS: ○
“Our primary business objectives are to maximize: (i) sustainable long-term growth in earnings and funds from operations per share and unit, (ii) cash flow and returns to our stockholders and our Operating Partnership’s unitholders through the payment of dividends and distributions and (iii) return on invested capital. We expect to accomplish these objectives by achieving superior risk-adjusted returns, prudently allocating capital, diversifying our product offerings, accelerating our global reach and scale, and driving revenue growth and operating efficiencies”
● SOURCE OF REVENUE: ○ Generates majority of revenue by leasing properties to customer sunder operating lease agreements ● YEARS IN OPERATION: ○ March, 2004 ● THINGS TO NOTE: ○ In July 2023, Digital Realty the first NVIDIA DGX H100-Ready data center
*Based on common publicly traded share class (NYSE: DLR)
KEY POINTS
Item 1
The Roots Largest global provider of cloud data centers Quarterly cash dividend payable September 29, 2023 Ongoing at-the-money primary common stock offering
Company Metrics
Inside Ownership
Short Interest
Institutional Shares
Item 3
Market Cap:
$39.99B
350,295,296 Shares
789,185 Shares
16,731,097 Current Shares Short
Dividend:
3.69%
Beta:
0.57
Item 2
(115.72% Overall)
(0.26% Overall)
(5.54% Overall)
PE Ratio:
104.02
DLR Monthly Chart
No expectation to the rule, DLR has corrected from repeat all time highs with the rest of the market. Resistance built where those new levels were established provide a rejection point now that the monthly Double Bottom* has completed its price target.
* Link to the definition of pattern
{insert daily candle chart} DLR Weekly Chart
Healthy corrective movement after the monthly pattern’s completion likely finds Support on EMA Confluence at post-COVID price action near $115. Should that Support hold a return to mean price movement would approach $146. Failure under $114 will send trading to the next support level around $104.
* Link to the definition of pattern
PREVIOUS MARKET SENTIMENT / REACTIONS
OPENING PRICE
HIGH OF DAY
LOW OF DAY
CLOSING PRICE
TRADING VOLUME
DATE
EVENT*
08/09/2023
$118.63
$119.98
$118.12
$119.31
1.7M
Digital Realty Declares Quarterly Cash Dividend
08/07/2023
$120.23
$121.7
$119.84
$120.89
1.8M
DIGITAL REALTY INTRODUCES HIGH-DENSITY COLOCATION
07/27/2023
$119.86
$120.7
$114.98
$115.15
3.3M
Digital Realty Trust (DLR) Beats Q2 FFO and Revenue Estimates
07/18/2023
$118.14
$118.61
$115.62
$117.31
3.4M
Digital Realty Selects IBM Sustainability Software
● In the 3 trading days prior to 08/09/2023, price movement was overall sideways . In the three trading days after, price movement went upwards . ● In the 3 trading days prior to 08/07/2023, price movement was overall downwards . In the three trading days after, price movement went sideways . ● In the 3 trading days prior to 07/27/2023, price movement was overall downwards . In the three trading days after, price movement went upwards . ● In the 3 trading days prior to 08/18/2023, price movement was overall downwards . In the three trading days after, price movement went upwards .
Decreasing volume trend after publications, although bearish in nature creates an opportunity for short bursts upwards.
*Events have a hyperlink for information specific to that day
Earnings Report for Q2 FY23*
June 30, 2023 December 31, 2022
Items to Note Items to Note In the first quarter of 2023, Digital Realty reported revenues of $1.3 billion, marking a 9% increase from the prior quarter and a 19% rise compared to the same quarter in the previous year. ● Thing 1 ● In the second quarter, Digital Realty executed the sale of 7.8 million common stock shares through its ATM program, achieving a weighted average price of $95.96 per share and generating approximately $743 million in net proceeds. Thing 2 2023 Financial Outlook: Digital Realty lowered its 2023 Core FFO per share and constant-currency Core FFO per share outlook of $6.65 - $6.75 to $6.55 - $6.65 during the second quarter
ASSETS Cash and cash equivalents Investments in properties, net
124,519
141,773
24,178,182 42,388,734
23,774,662 41,484,998
Total assets
LIABILITIES AND STOCKHOLDERS’ EQUITY Accounts payable
1,420,239 22,916,154 1,366,267
1,471,044 21,862,854 1,139,322**
Deployment
Total current liabilities
Total revenues
COST AND EXPENSES Research and development General and administrative Total cost and expenses Loss from operations
N/A
N/A
109,616 1,211,407
105,776** 968,950**
N/A
N/A
Net Income
115,646
63,863**
NET LOSS/GAIN PER SHARE Basic and diluted net (loss)/gain per share
0.37
0.19**
WEIGHTED AVERAGE SHARES USED IN CALCULATING: Basic net loss/gain per share
295,390 306,819
284,694** 285,110**
Diluted net loss/gain per share
*Link to the company's most recent 10-Q Form. Amounts in thousands except per-share data. ** As of June 30, 2022
INSIDER TRADING
Shares Outstanding: 302,709,295
Last purchase was seen in 2022, Stein A William purchased 5000 shares at the average price of $113 on september 15th. There has been continuously sales in 2023.
Insider Shares: 789,185
Insider Ownership: 0.26%
Insiders are a company's officers, directors, relatives, or anyone else with access to key company information before it's made available to the public. Insider Trading refers to these people and their purchases, sales or exercise of options contracts.
INSTITUTIONAL OWNERSHIP Institutional Owners*: 1668;
with 1614 Long, 28 Short, 26 Long & Short Shares Outstanding: 302,710,000 Institutional Shares: 301,832,141 Institutional Value: 39.875 Billion Top 3 Institutional Owners: APG Asset Management US Inc.: 9,554,277 Vanguard Group Inc: 9,086,150 Bank Of America Corp: 7,348,672
*Institutional ownership is the amount of stock owned by large entities that manage funds on behalf of others. Stocks with a large amount of institutional ownership are often looked upon favorably. Shares outstanding are the total amount of shares issued by the company
SHORT INTERES T Latest Market Date: 09/01/2023 Market Date
Short Volume Ratio
Short Volume Total Volume (In Millions)
Short Volume:
244,706
08/31/22
336,316
470,081
71.54
08/30/22
427,074
609,425
70.08
Market Volume: 391,026
08/29/22
282,476
544,840
51.85
Short Volume Ratio: 62.58
08/28/22
201,586
612,905
32.89
Short Shares Availability: 6,100,000
08/25/22
335,199
679,263
49.35
Short Borrow Fee Rate (%): 0.28
08/24/22
734,742
1,157,594
63.47
Why is this important : A reduction in the percentage of short float typically represents optimism in the company by the stock market from a larger viewpoint
CONCLUSION Digital Realty Trust Inc. (NYSE: DLR) is the largest global provider of cloud- and carrier- neutral data center, colocation and interconnection solutions with over 300 data centers in more than 50 cities worldwide serving over 5,000 customers. The Company was incorporated in 2004, and started returning capital to shareholders in the form of a quarterly cash dividend by the end of that year with a dividend of $0.156318. After consistently offering quarterly cash dividends, the board of directors has most recently authorized a quarterly cash dividend of $1.22 per share of common stock, payable on September 29th, 2023. As of June 30th, 2023, the Company had $17.2 billion in unsecured debt. Additionally, the Company aligned its ownership requirements to amend the bylaws with SEC standards. This improved Board diversity to 44% female and ethnically diverse.
Threats
Strengths
Opportunities
Weaknesses ● Ongoing at-the-money common stock primary offering ● Decreased outlook for FY23 Core FFO and constant-currency Core FFO per share quarter-over-quarter
● Competitors in data center space ● Refinancing debt during a rising interest rate environment ● Losing key partnerships with major semiconductor providers
● Strong history of a growing quarterly dividend ● Raised $3billion through capital recycling and at-the-money offering(s).
● First NVIDIA DGX H100 - ready data center ● New partnership with India’s largest private sector company (India’s goal of a $1 trillion digital economy by 2025) ● Growing AI industry and demands ● Growing cloud industries and demands
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Thank you for the reading this Roots Research publication on DLR
0 member(s) of Roots Research LLC have a position in their total portfolio.
Published by Roots Research, LLC. on September 4th, 2023
REFERENCES
Title Page - “Careers.” Digitalrealty.com, 2023, careers.digitalrealty.com/. Why We Are Talking About This Stock - “Digital Realty Announces Its First NVIDIA DGX H100-Ready Data Center.” Digitalrealty.com, 2021, investor.digitalrealty.com/news/news-details/2023/Digital-Realty-Announces-Its-First-NVIDIA-DGX-H100-Ready-Data-Center/default.aspx. “Digital Realty Declares Quarterly Cash Dividend for Common and Preferred Stock.” Digitalrealty.com, 2021, investor.digitalrealty.com/news/news-details/2023/Digital-Realty-Declares-Quarterly-Cash-Dividend-for-Common-and-Preferred-Stock-e27cfef3e/default.aspx. “Digital Realty Trust, Inc. (DLR) Company Profile & Facts - Yahoo Finance.” @YahooFinance, 2023, finance.yahoo.com/quote/DLR/profile?p=DLR. Form 10-K." SEC EDGAR, 27 Feb. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/0001297996/000155837023002087/dlr-20221231x10k.htm#ITEM1BUSINESS_530051. “Form 10-Q for the Quarterly Period Ended June 30, 2023." SEC EDGAR, 4 Aug. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/1297996/000155837023013321/dlr-20230630x10q.htm. About the Company - Form 10-K." SEC EDGAR, 27 Feb. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/0001297996/000155837023002087/dlr-20221231x10k.htm#ITEM1BUSINESS_530051. “Form 10-Q for the Quarterly Period Ended June 30, 2023." SEC EDGAR, 4 Aug. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/1297996/000155837023013321/dlr-20230630x10q.htm. Key Points- “DLR Digital Realty Trust Inc Stock - Share Price, Short Interest, Short Squeeze, Borrow Rates (NYSE).” Fintel.io, 2022, fintel.io/ss/us/dlr. “DLR - Digital Realty Trust Inc Stock - Stock Price, Institutional Ownership, Shareholders (NYSE).” Fintel.io, 2023, fintel.io/so/us/dlr. “Digital Realty Trust, Inc. (DLR) Company Profile & Facts - Yahoo Finance.” @YahooFinance, 2023, finance.yahoo.com/quote/DLR/profile?p=DLR. “DLR Insider Trading - Digital Realty Trust Inc.” Fintel.io, 2020, fintel.io/sn/us/dlr.
Previous Market Sentiment - “Digital Realty Declares Quarterly Cash Dividend for Common and Preferred Stock.” Yahoo! Finance, Yahoo!, finance.yahoo.com/news/digital-realty-declares-quarterly-cash-200500873.html. “Digital Realty Introduces High-Density Colocation Offering to Address Data and AI Growth Challenges.” Yahoo! Finance, Yahoo!, finance.yahoo.com/news/digital-realty-introduces-high-density-080000067.html. “Digital Realty Trust (DLR) Beats Q2 FFO and Revenue Estimates.” Yahoo! Finance, Yahoo!, finance.yahoo.com/news/digital-realty-trust-dlr-beats-214514800.html. “Digital Realty Selects IBM Sustainability Software to Transform Data into Insights across Its Global Data Centers and Offices.” Yahoo! Finance, Yahoo!, finance.yahoo.com/news/digital-realty-selects-ibm-sustainability-130000546.html. Earnings Report - “Form 10-Q for the Quarterly Period Ended June 30, 2023." SEC EDGAR, 4 Aug. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/1297996/000155837023013321/dlr-20230630x10q.htm. Insider Trading - “Fintel.io/us/dlr, 5 sep. 2023 Institutional Ownership - “DLR - Digital Realty Trust Inc Stock - Stock Price, Institutional Ownership, Shareholders (NYSE).” Fintel.io, fintel.io/so/us/dlr. Accessed 3 Sept. 2023. Short Interest - “Digital Realty Trust Short Interest Ratio and Volume (NYSE:DLR).” Www.marketbeat.com, www.marketbeat.com/stocks/NYSE/DLR/short-interest/. Accessed 3 Sept. 2023. “DLR Digital Realty Trust Inc Stock - Share Price, Short Interest, Short Squeeze, Borrow Rates (NYSE).” Fintel.io, fintel.io/ss/us/dlr. Accessed 3 Sept. 2023. Conclusion - “Digital Realty Declares Quarterly Cash Dividend for Common and Preferred Stock.” Digitalrealty.com, 2021, investor.digitalrealty.com/news/news-details/2023/Digital-Realty-Declares-Quarterly-Cash-Dividend-for-Common-and-Preferred-Stock-e27cfef3e/default.aspx. “Digital Realty Trust, Inc. (DLR) Company Profile & Facts - Yahoo Finance.” @YahooFinance, 2023, finance.yahoo.com/quote/DLR/profile?p=DLR. Form 10-K." SEC EDGAR, 27 Feb. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/0001297996/000155837023002087/dlr-20221231x10k.htm#ITEM1BUSINESS_530051. “Form 10-Q for the Quarterly Period Ended June 30, 2023." SEC EDGAR, 4 Aug. 2023, https://www.sec.gov/ix?doc=/Archives/edgar/data/1297996/000155837023013321/dlr-20230630x10q.htm. “Reliance Industries Enters into Agreement to Invest alongside Digital Realty and Brookfield Infrastructure to Expand Data Center Joint Venture in India.” Digitalrealty.com, 2021, investor.digitalrealty.com/news/news-details/2023/Reliance-Industries-Enters-into-Agreement-to-Invest-Alongside-Digital-Realty-and-Brookfield-Infrastructure-to-Expand-Data-Center-Joint -Venture-in-India/default.aspx.
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