NextDC Sees Easing Capex-Related Earnings Headwinds
Dow Jones
Yesterday
0133 GMT - NextDC's bull at Macquarie sees the bottom-line impact of the data-center operator's capital expenditure easing over coming years. One of the investment bank's analysts writes in a note that elevated capex has historically driven negative revisions to consensus EPS forecasts, but this is now being mitigated. The analyst explains that a large proportion of upcoming capex relates to what are now accounted as investment properties, while lower depreciation and amortization on this capex drives earnings tailwinds. Revaluations should intensify this and drive deferred tax benefits in upcoming periods, the analyst adds. Macquarie keeps an outperform rating on the stock and lifts its target price 9.4% to 19.70 Australia dollars. Shares are down 0.3% at A$13.825.
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