Robert Gutman is a Director and the Equity Research Analyst covering the communications infrastructure and telecom services sectors at Guggenheim Securities. His latest call may salvage the current Retail REIT investor portfolio: “…we would point out that data centers are currently trading on multiples in line with the average of the broader REIT universe despite the fact that they have a meaningfully higher AFFO growth rate. On average, we estimate 10.7% year-over-year growth in 2017 and 13.1% in 2018 versus half that, or 5.3% and 6.6%, in 2017 and 2018 for the broader REIT average. They also have a roughly 50% higher total-return profile, which could support the argument for a premium multiple on a relative basis.”
In his exclusive interview with the Wall Street Transcript, Mr. Gutman reviews his top picks in a portfolio that includes CoreSite (NYSE:COR), CyrusOne (NASDAQ:CONE), DuPont Fabros (NYSE:DFT), Digital Realty (NYSE:DLR), Equinix (NASDAQ:EQIX), InterXion (NYSE:INXN) and QTS (NYSE:QTS).
His in depth analysis of these stocks and more reveal the key investment thesis that growth in cash flows will drive prices higher for these shares, especially relative to their retail REIT cousins. Inevitably, the fastest growers will see their investors rewarded well.
For additional detail as well as numerous other picks, read the entire interview now available at the Wall Street Transcript.
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