Digital Realty Trust Hits Record Bookings Amid AI Surge, Sparking Valuation Debate

Digital Realty Trust (DLR) has reported record-breaking bookings for the fourth quarter and the full year 2025, fueled by the massive expansion of AI infrastructure and cloud computing services. This robust performance has led to positive guidance for 2026, highlighting the company's pivotal role in the global data center sector. However, analysts are currently divided over the stock's market valuation due to conflicting financial models. While earnings-based analysis suggests the current price of $174.57 may be overvalued, discounted cash flow (DCF) models estimate a significantly higher fair value of $246.67. This discrepancy reflects the ongoing challenge of pricing future AI-driven growth against traditional financial metrics. Consequently, the outlook remains mixed as investors weigh strong fundamental tailwinds against potential price overextension.