Analyst Expects Equinix To Raise Long-Term Outlook At Upcoming Investor Day

BMO Capital Markets analyst Ari Klein raised the price target of Equinix Inc EQIX to $870 from $800, maintaining an Outperform rating.

The analyst is bullish on EQIX's high-quality portfolio, strong pricing power, competitive moat, and fortress balance sheet.

The analyst expects the company to underline the core value proposition of its premium platform and future growth opportunities (including AI) at its upcoming analyst day on June 21. 

Klein expects EQIX to highlight the services business as a differentiator in enhancing customer stickiness and boosting competitive advantage.

Klein projects EQIX to increase its long-term revenue growth guidance to 8%-10% (from 7%-9% prior) on healthy pricing dynamics and a favorable impact from expansions and revise its AFFO per share growth guidance to 7%-11% (from 7%-10%).

The analyst believes EQIX is well-positioned to capitalize on the increasing adoption of generative AI and can enhance its interconnection offerings and global footprint. 

Klein sees 2022-2025 revenue and AFFO per share CAGR of 10.0% and 8.1%, respectively.

The analyst raised the estimates for revenues to be $8.25 billion (from $8.24 billion) for 2023 and $8.92 billion (from $8.91 billion) for 2024 and FFO per share to $22.56 (from $22.55) for 2023 and $25.10 (from $24.98) for 2024.

Price Action: EQIX shares are trading higher by 0.77% at $785.59 on the last check Friday.