Evaluation of data center hosting return rate: The economics of emerging AI infrastructure companies have improved, with unleveraged IRR reaching 8-13%, and room for equity value c
The Bernstein report uses two indicators, ROA and cost return, to compare the stable asset returns of traditional managed REITs and emerging AI infrastructure companies.
The Bernstein report uses two indicators, ROA and cost return, to compare the stable asset returns of traditional managed REITs and emerging AI infrastructure companies. The report pointed out that Equinix (EQIX.US) has higher returns than Digital Realty (DLR.US) due to its high proportion of retail custody, high proportion of high-margin Internet services and differences in asset classification methods. Among emerging AI infrastructure companies, CORZ and RIOT have relatively high returns due to their low capital expenditure structure, while WULF, CIFR, etc. can better represent the overall return level of the segment. The report believes that cost-return rate is a better project-level return evaluation indicator. The economics of custody transactions of emerging AI infrastructure companies are improving, with unleveraged IRR reaching 8-13%, and there is room for equity value creation. The market's attention to AI infrastructure is more focused on the demand side, but it may not pay enough attention to the improvement of the supply side (managed transaction economics). One-sentence conclusion: The custody transaction economics of emerging AI infrastructure companies are improving. The unlevered IRR at the project level has reached 8-13%. There is significant room for equity value creation and it is an important direction for AI infrastructure investment. Positive/negative: Positive for Equinix (EQIX.US), Digital Realty (DLR.US), Terawulf (WULF.US), Cipher Mining (CIFR.US), Core Scientific (CORZ.US), Cleanspark (CLSK.US), Riot Platforms (RIOT.US), etc. The market pays high attention to AI infrastructure, but differentiated pricing on specific company valuations and returns may not be enough. Catalysts: 1) Progress in the signing and delivery of data center hosting agreements for each company; 2) Actual data on project IRR; 3) The impact of interest rate changes on the valuation of REITs.