NEXTDC: You don’t need AI to see this demand wave

About the author:

Nick Harris
Author name:
By Nick Harris
Job title:
Senior Analyst
Date posted:
29 August 2023, 7:30 AM
Sectors Covered:
Telecommunications, Technology

  • NEXTDC's (ASX:NXT) FY23 result was in line with expectations while FY24 guidance was slightly below due to the substantial costs associated with bringing significant new capacity on line. FY24 / 25 will be scaleup years as NXT begins the next chapter of growth.
  • After consistently telling investors there were some big contracts deep in negotiations, NXT has contracted 60MW of capacity in the last 6 months. This is more than they sold, cumulatively, in their first 10 years of existence.
  • Orders of this magnitude take time to physically install so don’t materially move the dial on revenue until FY25. They underpin growth for the next 5+ years, and once fully ramped-up, offer earnings stability for the next 10+ years.
  • Add retained, price target lifted to (login to view).

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