Macquarie opens DigiCo REIT coverage with 'outperform' rating
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The news: Shares in DigiCo Infrastructure REIT rose on the ASX after Macquarie initiated its coverage on the data centre owner and developer with an 'outperform' rating.
The numbers: DigiCo shares were up 1.7% to $4.57 by 1:50pm AEDT, having first floated at $5 in December.
Macquarie gave the stock a $5.33 target price, with a 76% upside to its EBITDA base case by FY30.
The context: Macquarie analysts said there a "number of positive catalysts" for the stock in the near term, including DigiCo gaining Hosting Certification Framework (HCF) approval by mid-2025, further contract announcements, and potential S&P Index inclusion in March.
However, they noted that DigiCo's strategy is capital intensive and growth relies on access to capital, developing and acquiring new data centres, as well as expediently leasing existing and future capacity.
The source: Macquarie research
