If you have been watching Equinix (EQIX) lately, the finalisation of its settlement agreement with investors is hard to miss. The agreement, which still awaits court approval, wraps up a turbulent chapter that began with a Hindenburg Research report earlier this year. That report accused the company of overstating its Adjusted Funds From Operations by more than 20% in 2023. This disclosure quickly led to a class action lawsuit and introduced uncertainty into the outlook for the world’s largest data center REIT. With the legal overhang now moving toward resolution, investors are recalibrating their expectations for the company’s next phase.
This development comes at a time of conflicting momentum for Equinix shares. After a challenging period, including a nearly 18% slide year to date and a 3% drop over the past twelve months, the stock’s multi-year performance remains in positive territory with a 25% gain over three years and 13% over five. Despite recent volatility and scrutiny, the company’s latest annual results show revenue up 8% and net income rising 13%. This reflects steady operational progress even as litigation risk has concerned some investors. At yesterday’s close, shares remained well below their earlier peaks, suggesting that market sentiment may still be pricing in reputational and regulatory risks resulting from the Hindenburg report.
After months of turbulence and renewed focus on valuation, investors are considering whether this is the moment to pick up Equinix at a discount or if the market has already factored in a full recovery.
The most widely followed narrative sees Equinix as undervalued by nearly 20%, reflecting high expectations for future growth and profitability driven by global digital infrastructure trends.
Strategic data center expansion and strong customer demand in AI and cloud drive long-term growth and recurring revenue streams. High-margin interconnection services and disciplined capital management support margin expansion and improved earnings per share.
Curious why Equinix’s growth story is making waves among analysts? There is one detail about future revenue, profit margins, and a bold earnings forecast that is driving their valuation, and it is not what you would expect from most data center REITs. Want to uncover which aggressive assumptions are fueling that surprising price target? Read on to find out how this narrative is re-shaping investor expectations.
Result: Fair Value of $957 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, risks remain, including the industry’s reliance on sustained AI demand and the company’s exposure to large-scale capital investments, which could weigh on profitability.
Find out about the key risks to this Equinix narrative.
Looking at it from a different angle, market valuation based on price-to-earnings suggests Equinix may actually be on the expensive side compared to its sector. Does this raise doubts about the optimistic growth expectations?
See what the numbers say about this price — find out in our valuation breakdown.
NasdaqGS:EQIX PE Ratio as at Sep 2025
Stay updated when valuation signals shift by adding Equinix to your watchlist or portfolio. Alternatively, explore our screener to discover other companies that fit your criteria.
If you would rather dig into the numbers yourself and form your own view on Equinix, it takes just a few minutes to build your own perspective. So why not give it a try Do it your way
A great starting point for your Equinix research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include EQIX.
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