Digital Realty stock gains support as AI data center demand lifts guidance

Digital Realty Trust stock (ISIN US2538681030) is trading close to USD 183, supported by stronger guidance and mounting AI-related data center demand as of September 18, 2026. According to 24/7 Wall St on September 20, 2026, shares traded around USD 183.88 on September 18, 2026, up nearly 19% since the start of the year.

Guidance raised on AI-driven demand

The key fundamental catalyst for Digital Realty in 2026 is a higher outlook for Core funds from operations (FFO). According to 24/7 Wall St, management has raised 2026 Core FFO guidance to a range of USD 8.00 to USD 8.10 per share, which covers the annualized dividend of USD 4.88 per share with room to fund development.

The same report highlights that Digital Realty’s development pipeline stands at about 1.4 gigawatts of data center capacity under construction, at a total cost of roughly USD 20 billion, with about 63 percent of this capacity already pre-leased and an expected stabilized yield of 11.5 percent. According to 24/7 Wall St, that pipeline is anchored by record interconnection bookings of USD 108 million in the second quarter and a total backlog of about USD 1.9 billion at 100 percent share.

Pricing power and backlog strengthen the case

Pricing power is another point of support for the Digital Realty story. As 24/7 Wall St reports for the latest quarter, cash renewal spreads were above 25 percent, and the greater-than-one-megawatt contract bucket delivered a mark-to-market uplift of 66.7 percent. In addition, the backlog of around USD 1.9 billion corresponds to roughly 30 percent of current in-place data center rental revenue, providing multi-year visibility on growth.

Market valuation metrics show investors have already priced in a sizable part of that growth. According to data from Pluang, Digital Realty traded at USD 182.12 with a price-to-earnings ratio of 88.84 as of the latest snapshot, while the consensus price target stood around USD 222.06. The same overview notes a 52-week trading range between USD 147.93, recorded on December 18, 2025, and USD 203.91, reached on April 20, 2026, underscoring that the current share price is below the recent high but significantly above the year’s low.

Analyst sentiment and market positioning

Analyst sentiment toward Digital Realty remains broadly constructive. According to Pluang, about 69 percent of analyst ratings on the stock are currently in the buy category, with the remainder split between hold and sell recommendations, and the consensus view is described as strongly bullish. The same source cites a consensus price target of around USD 222.06, implying upside from the USD 182.12 price level used in its analysis.

A narrative-based valuation perspective also points to potential undervaluation. In a recent article discussing thematic investor narratives, Simply Wall St notes that Digital Realty closed at USD 182.12 while its most followed narrative pegs fair value at USD 223.32, suggesting the shares may be around 18 percent undervalued versus that fair-value estimate.

Risks: power, capital intensity and valuation

Despite the supportive operating data, several risks remain. As 24/7 Wall St outlines, Digital Realty’s business model is exposed to power constraints and heavy development capital expenditure. Development capex guidance for the current cycle runs between USD 4.25 billion and USD 4.75 billion net of partner contributions, so any slowdown in hyperscale demand, permitting delays, or equipment bottlenecks in transformers and switchgear could affect the timing and returns of the pre-leased pipeline.

Valuation is another consideration for investors. According to Pluang, the stock’s high price-to-earnings ratio of 88.84 reflects expectations of strong growth, while the platform’s Aura AI summary flags net cash outflows and debt levels as key financial risks. Simply Wall St also cautions that the bullish Digital Realty narrative could weaken if rapid U.S. data center buildouts overshoot end-user demand or if higher financing costs compress returns on new projects.

Digital Realty stock near upper part of its 52-week range

From a market-data perspective, Digital Realty now trades in the upper portion of its recent range but below its 52-week high. Per Pluang’s latest data, the share price of USD 182.12 sits closer to the 52-week high of USD 203.91 than to the low of USD 147.93, while the company’s market capitalization is reported at around USD 67.57 billion as of the same snapshot. Trading volume in that view stood at about 4,489,371 shares, indicating active interest from investors.

For investors, the combination of raised 2026 Core FFO guidance to USD 8.00 to USD 8.10 per share, a development pipeline of 1.4 gigawatts at an expected stabilized yield of 11.5 percent, and cash renewal spreads above 25 percent is now balanced against the capital intensity and power constraints of AI-oriented data centers and a valuation multiple that already prices in robust growth.

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