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Wells Fargo Downgrades DuPont Fabros Technology (DFT) to Market Perform; Sluggish Leasing Necessitates Higher Risk Quotient

February 9, 2012 7:24 AM EST Send to a Friend
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Price: $27.33 +0.66%

Rating Summary:
    6 Buy, 8 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 24 | New: 21
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Wells Fargo downgraded DuPont Fabros Technology (NYSE: DFT) from Outperform to Market Perform with a price target range cut from $24-25 to $22-24.

Wells analyst says, "We still believe DFT holds sizable longer-term upside potential, but sluggish leasing on the development pipeline, and pressure on development yields suggest a higher discount rate on the future NAV potential is warranted. DFT provided FY2012 guidance that was ~$0.40 below consensus (more than 25%) but shares were down <5% (vs. RMZ up +0.10%)--much of the difference was timing driven, but the lease-up environment clearly appears slower than originally expected. We estimate the NAV (including NPV from current development pipeline) is now $23/share (applies 8% cap rate). Lack of clarity on lease-up, 32MW of available supply, and a leasing target for 2012 that still doesn't appear
overly conservative make us cautious."

For an analyst ratings summary and ratings history on DuPont Fabros Technology click here. For more ratings news on DuPont Fabros Technology click here.

Shares of DuPont Fabros Technology closed at $24.36 yesterday.




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