Mizuho says DeepSeek’s new artificial intelligence model will drive several questions for data center stakeholders, including the continued need the for massive hyperscaler spend and how far use cases that drive monetization are. There may be a “knee-jerk negative reaction” to data center stocks, more so for Digital Realty (DLR), to the news given fears of a likely rethink of big AI spending, the analyst tells investors in a research note. Mizuho would be buyers of any weakness, saying a lot of claims need to be verified. Further, most real estate investment trust development pipelines are highly pre-leased, and the companies have “robust” double-digit pricing power in fiscal 2025, contends the firm. Mizuho has a Neutral rating on American Tower (AMT) and Outperform ratings on Digital Realty and Equinix (EQIX).
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