Digital Realty Trust, Inc. (NYSE:DLR) and Equinix, Inc. (NASDAQ:EQIX) own two of the hardest assets to replicate in the AI boom: powered, connected data-center capacity. Their stocks currently offer a cleaner choice than the sector narrative suggests. Digital Realty trades at roughly 22 times the midpoint of its 2026 core FFO guidance, while Equinix trades near 24 times its 2026 AFFO-per-share guidance.
The comparison is especially useful because both landlords are already confronting tighter power and permitting constraints. Scarcity can strengthen existing campuses, but only if new investment earns attractive returns rather than forcing endless capital raises.
Digital Realty has the stronger near-term leasing signal
Digital Realty’s second-quarter revenue rose 29% to $1.9 billion, while core FFO per share excluding promote income increased to $2.13 from $1.87. More important for future earnings, signed-but-not-commenced backlog reached $1.4 billion of annualized base rent at Digital Realty’s share. July added two hyperscale leases representing another $205 million of annualized rent at its share.
Renewal pricing was also strong, with cash rents increasing 25.4%. Management raised 2026 core FFO-per-share guidance excluding net promote to $8.15 to $8.20. The bear case is the price of funding that growth. Digital Realty sold 13.5 million shares through its ATM program in the first half, raising about $2.5 billion, while net development capex guidance reached $4.25 billion to $4.75 billion.
Equinix offers the stronger moat, but investors pay for it
Equinix’s network density and interconnection ecosystem give it a different advantage. Second-quarter monthly recurring revenue grew 11% year over year, while normalized constant-currency AFFO per share rose 18%. Management now expects 2026 revenue growth of 11% to 12% and AFFO-per-share growth of 10% to 12%, with adjusted EBITDA margins around 51%.
That consistency deserves a premium, but Equinix also carries about 4.9 times net debt to EBITDA and trades at the higher AFFO multiple. Digital Realty’s own leverage is meaningful, though its quarter-end net debt to adjusted EBITDA was 4.7 times, and its development pipeline adds more execution risk.
Professional investors increased both positions in Q2. Insider Monkey tracked 73 funds holding Digital Realty, up from 46 in Q1; D. E. Shaw increased its stake 43% to 1.54 million shares. Equinix also had 73 holders, up from 65, while Coatue Management increased its position 17% to 1.27 million shares. Digital Realty short interest stood at 8.39 million shares on August 31, 2.53% of float, with 3.97 days to cover.
Equinix remains the higher-quality interconnection franchise. At current prices, however, Digital Realty offers the stronger upside setup because investors get faster leasing momentum and a slightly lower cash-flow multiple, provided its heavy development spending converts into rent without excessive dilution over the next several years for shareholders.
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