If you’re looking to invest in today’s booming tech sector and get exposure to the AI trend, then the ASX 200 tech share NextDC Ltd (ASX: NXT) may be the way to go. Brokers have been raving about this company following their recent trading update which showed that contracted utilisation had increased by 43%, or 35.9 megawatts (MW), to 120 MW since 31st December. This growth was mainly driven by their new S3 data centre in Sydney.
Brokers have been overwhelmingly bullish about this ASX 200 tech share and have been re-confirming their buy ratings and increasing their price targets. For example, Goldman Sachs – which gave it a buy rating and an improved price target of $14.90 – believes the customer responsible for the increase could be the global tech giant Microsoft. Meanwhile, Citi, who has retained their buy rating and increased their price target to $14.45, were particularly impressed with the longer than normal contract length, which could be a sign of a solid demand outlook.
When it comes to investing in the AI trend, Citi believes NextDC shares could be a great option for investors as it is a “play on a secular shift towards cloud computing (with Gen AI another use case/demand driver) and see it as a defensive growth play in a slowing macro environment.” Finally, Morgans kept its add rating with their improved price target of $13.50 and added that the cancelation of Microsoft’s planned data centre in Lane Cove Sydney could have played a role in the increased demand for NextDC shares.
NextDC Ltd is an ASX 200 listed company which enables an empowered and responsive digital future, through providing a robust, secure and reliable data centre infrastructure. It is an expert in data centre engineering and design, with a portfolio spanning across Australia, Singapore, and the United States. They focus on creating or adapting their impacts of digitalisation and its needs across the Asia Pacific region, while promoting the development of digital technologies.
David Dzienciol is the Chief Executive Officer of NextDC. He was appointed at the beginning of May 2019 and has a background in engineering, product, sales and strategy roles across Australia, Europe and Asia. He previously worked for global software and data companies including Salesforce and Teradata. Dzienciol is passionate about enabling technology innovation to propel industry growth and change, as well as building resilient teams focused on delivering success.
In conclusion, this ASX 200 tech share is giving investors the opportunity to get in on the AI trend and have exposure to the booming tech sector. Several brokers have come out and reaffirmed their buy ratings, with revised price targets, for NextDC Ltd, meaning it could be an excellent buy for investors.
