Digital Realty Trust poised for AI-driven data center growth but shares face limited near-term upside.

Digital Realty Trust (DLR) is expanding its data center capacity with 1.2GW under construction and a $1.8 billion backlog, driven by rising demand from AI inferencing and hyperscale customers. Despite strong growth prospects and a stable balance sheet, the stock is downgraded to Hold due to its premium valuation and stagnant dividend since 2022. Risks include new competition and community opposition, though global expansion and reduced energy exposure add stability. Investors should watch for long-term growth but expect limited short-term share price gains.