Reviewing Digital Realty Trust (DLR) and Its Peers

Digital Realty Trust (NYSE: DLR) is one of 85 public companies in the “Commercial REITs” industry, but how does it compare to its rivals? We will compare Digital Realty Trust to related businesses based on the strength of its valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.

Valuation and Earnings

This table compares Digital Realty Trust and its rivals revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Digital Realty Trust $2.26 billion $1.22 billion 47.71
Digital Realty Trust Competitors $482.34 million $305.34 million 32.43

Digital Realty Trust has higher revenue and earnings than its rivals. Digital Realty Trust is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Institutional and Insider Ownership

68.7% of shares of all “Commercial REITs” companies are held by institutional investors. 0.4% of Digital Realty Trust shares are held by insiders. Comparatively, 8.3% of shares of all “Commercial REITs” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Digital Realty Trust and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Digital Realty Trust 21.27% 12.39% 4.15%
Digital Realty Trust Competitors 50.87% 6.60% 3.77%

Volatility and Risk

Digital Realty Trust has a beta of 0.01, suggesting that its share price is 99% less volatile than the S&P 500. Comparatively, Digital Realty Trust’s rivals have a beta of 0.81, suggesting that their average share price is 19% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Digital Realty Trust and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Digital Realty Trust 0 9 6 0 2.40
Digital Realty Trust Competitors 628 2464 2128 22 2.29

Digital Realty Trust currently has a consensus target price of $120.62, suggesting a potential upside of 0.71%. As a group, “Commercial REITs” companies have a potential upside of 6.07%. Given Digital Realty Trust’s rivals higher possible upside, analysts clearly believe Digital Realty Trust has less favorable growth aspects than its rivals.

Dividends

Digital Realty Trust pays an annual dividend of $3.72 per share and has a dividend yield of 3.1%. Digital Realty Trust pays out 148.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Commercial REITs” companies pay a dividend yield of 4.0% and pay out 205.1% of their earnings in the form of a dividend. Digital Realty Trust has raised its dividend for 12 consecutive years.

Summary

Digital Realty Trust rivals beat Digital Realty Trust on 8 of the 15 factors compared.

Digital Realty Trust Company Profile

Digital Realty Trust, Inc. is a real estate investment trust (REIT). The Company is engaged in the business of owning, acquiring, developing and operating data centers. The Company is focused on providing data center and colocation solutions for domestic and international tenants across a range of industry verticals ranging from financial services, cloud and information technology services, to manufacturing, energy, healthcare and consumer products. As of December 31, 2016, its portfolio consisted of 145 operating properties, including 14 properties held as investments in unconsolidated joint ventures, of which 104 are located throughout the United States, 32 are located in Europe, four are located in Asia, three are located in Australia and two are located in Canada. It is a general partner of Digital Realty Trust, L.P. As of December 31, 2016, it owned an approximate 98.5% common general partnership interest in Digital Realty Trust, L.P.

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