Equinix EQIX stands out as a cornerstone of the global digital infrastructure ecosystem as digital transformation reshapes industries worldwide.
Analysts seem bullish on this Zacks Rank #2 (Buy) stock. The estimate revision trend for 2026 funds from operations (FFO) per share indicates a favorable outlook for the company, with estimates moving north over the past two months.
Over the past three months, shares of Equinix have increased 7.6%, outperforming the real estate market’s 5.5% gain. Given its solid fundamentals and positive estimate revisions, the stock is likely to keep performing well in the quarters ahead.
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What Makes Equinix a Solid Choice?
AI-Driven Architecture Shift: Management noted that customer discussions have evolved from AI pilots to enterprise-scale adoption. As inference workloads and agentic AI become increasingly distributed, enterprises are placing compute and data exchange closer to users and data sources. These designs need private, low-latency connectivity across clouds, networks and model providers, and increasingly require controls to keep workloads within specific jurisdictions. This combination of edge proximity, interconnection density and sovereignty needs to support durable demand for Equinix’s neutral platform over multi-year investment cycles.
Operating Leverage and Higher Outlook: Equinix’s revenue base remains largely recurring, which helps convert bookings into predictable cash flow and supports operating leverage as utilization rises. In first-quarter 2026, recurring revenues grew 10% year over year on a normalized and constant currency basis, and total revenues increased 8% on the same basis to $2.444 billion. Adjusted EBITDA rose 13% on a normalized basis to $1.245 billion, while AFFO surpassed $1 billion for the first time, reaching $1.065 billion, and AFFO per share increased 10% on a normalized basis to $10.79. Reflecting this execution, management raised full-year 2026 guidance to revenues of $10.144-$10.244 billion, adjusted EBITDA of $5.165-$5.245 billion and AFFO per share of $42.31-$43.11, while indicating normalized monthly recurring revenues growth of 9-10%.
Capacity Expansion and Nordic Pipeline: Equinix continues to invest in capacity expansion to meet growing demand while using presales, disciplined site selection and partnerships to support returns on new developments. In first-quarter 2026, the company had 46 major projects underway across 32 markets, including six xScale projects, with more than 70% of retail expansion capex directed to major metros. Management also noted that about 25% of the 2026 retail capacity expansion has already been sold, supporting visibility as new capacity comes online.
Financial Flexibility: Equinix continues to balance expansion with access to diversified funding sources. As of March 31, 2026, it cited about $7.1 billion of available liquidity, including cash, short-term investments and an undrawn revolving credit facility. Equinix also ended the quarter with about $1.2 billion of common stock capacity remaining under its at-the-market program, preserving additional flexibility if needed.
Dividend Profile: Equinix has focused on maintaining a shareholder return. With fourth-quarter 2025 results, it raised the quarterly dividend by 10% to $5.16 per share, marking the 11th consecutive year of dividend growth. Equinix has increased its dividend five times in the last five years, and its five-year annualized dividend growth rate is 14.11%. Management expects 2026 cash dividends of about $2.037 billion.
Other Stocks to Consider
Some other top-ranked stocks from the broader REIT sector are Cousins Properties CUZ and American Tower AMT, each carrying a Zacks Rank of #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for CUZ’s 2026 FFO per share is pegged at $2.93, which indicates year-over-year growth of 3.17%.
The Zacks Consensus Estimate for AMT’s full-year FFO per share is pinned at $10.95, which suggests an increase of 1.77% from the year-ago period.
Note: Anything related to earnings presented in this write-up represents FFO, a widely used metric to gauge the performance of REITs.
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This article originally published on Zacks Investment Research (zacks.com).