DLR Stock Forecast & Price Target

Digital Realty Trust is supported by record demand strength, with 2Q26 leasing of about $208 million, record 0-1MW plus interconnection bookings of $108.3 million, and July hyperscale leases totaling $205 million at Digital’s share. Its $1.8 billion backlog, 63% pre-leased development pipeline, and multi-year low leverage of 4.7x strengthen visibility to multiple years of double-digit Core-FFO/share growth, while pricing power should improve as power-constrained, hard-to-build markets raise renewal spreads. Strategic acquisitions in Kansas City, Teraco, Columbia Capital, and Blackstone’s NoVa assets further expand capacity, fee income, and market position, reinforcing a favorable multi-year outlook.

Digital Realty Trust is challenged by a highly rate-sensitive valuation, where rising interest rates can disproportionately pressure data center stocks and multiple expansion is already vulnerable relative to peers. Its fundamentals also face demand and pricing risk from rapidly changing technology, a tougher macro backdrop, and potentially lower hyperscale and enterprise capex tied to AI and cloud infrastructure investment. With 90% of revenue tied to renting physical space, over half of business concentrated in the top 20 customers, and exposure to power supply, cybersecurity, and competitive leasing risk, any disruption could quickly compress revenue growth and profitability.