DigitalBridge Group (DBRG) AI Stock Analysis

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DigitalBridge Group

(NYSE:DBRG)

71Outperform

DigitalBridge Group's overall stock score reflects a strong financial performance and positive earnings call, indicating resilience and growth potential in its digital infrastructure portfolio. The company's strategic initiatives and successful fundraising bolster its outlook. However, high valuation metrics and revenue volatility are notable concerns. The stock's technical indicators suggest positive momentum, although caution is warranted due to potential overbought conditions.

Positive Factors

Financial Performance

DigitalBridge reported upside financial results and maintained its guidance, indicating stability and potential growth.

Growth Potential

The company has a significant backlog of capital expected to convert to fee-earning assets, providing visibility into future growth.

Investment Opportunity

Despite the stock being down, there is no fundamental deterioration in the business, making it an attractive risk/reward opportunity.

Valuation

The company's valuation recovery is just beginning, with the stock trading at a discount compared to peers, suggesting potential for outperformance.

Negative Factors

Cost Challenges

There is a concern about data center build costs increasing due to tariffs, impacting profitability.

Market Challenges

Digital Bridge has found it necessary to partner with other funds and accept lower fee-generating assets, indicating challenges in raising fee-generating assets in the market.

DigitalBridge Group (DBRG) vs. S&P 500 (SPY)

Market Cap

$2.25B

Dividend Yield0.34%

Average Volume (3M)3.35M

Price to Earnings (P/E)37.6

Beta (1Y)1.80

Revenue Growth-56.43%

EPS Growth-82.25%

CountryUS

Employees324

SectorReal Estate

Sector Strength66

IndustryREIT - Diversified

Share Statistics

EPS (TTM)-0.01

Shares Outstanding176,116,330

10 Day Avg. Volume3,616,067

30 Day Avg. Volume3,352,520

Financial Highlights & Ratios

PEG Ratio0.04

Price to Book (P/B)0.75

Price to Sales (P/S)0.00

P/FCF Ratio11.11

Enterprise Value/Market Cap0.52

Enterprise Value/Revenue0.35

Enterprise Value/Gross Profit1.94

Enterprise Value/Ebitda0.75

Forecast

1Y Price Target

$16.58

Price Target Upside38.74% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering7

DigitalBridge Group Business Overview & Revenue Model

Company DescriptionDigitalBridge (NYSE: DBRG) is an infrastructure investment firm. It specializes in investing and operating businesses across the digital ecosystem including cell towers, data centers, fiber, small cells, edge infrastructure, digital infrastructure and real estate. DigitalBridge Group, Inc. was founded in 2009 and is headquartered in Boca Raton, Florida with additional offices in Los Angeles, California; New York, New York; Boston, Massachusetts; Denver, Colorado; London, United Kingdom; Senningerberg, Luxembourg and Singapore.

How the Company Makes MoneyDigitalBridge Group makes money primarily through its investments in digital infrastructure assets and the management of these assets. The company generates revenue from leasing space and capacity in data centers, charging fees for the use of cell towers and fiber networks, and providing managed services to its clients. Additionally, as an investment management firm, DigitalBridge earns management and performance fees from institutional investors who commit capital to its funds. The firm's strategic partnerships with telecommunications companies, technology firms, and other stakeholders in the digital landscape also play a crucial role in enhancing its earnings potential and expanding its market presence.

DigitalBridge Group Financial Statement Overview

Summary

DigitalBridge Group is on a path of improvement, evident from its reduction in debt and a return to profitability. However, the company faces challenges with declining revenue and cash flow stability. While the balance sheet reflects improved financial health, the income statement and cash flow metrics suggest that further efforts are needed to solidify growth and enhance cash flow consistency.

Income Statement

Positive

The company has shown a declining trend in total revenue over recent years, with a significant drop in gross profit margin from previous highs. Despite a net loss in earlier years, the company managed to achieve a positive net income in 2024. While the EBIT and EBITDA margins have improved from negative values, they remain moderate compared to industry expectations.

Balance Sheet

Positive

DigitalBridge Group has significantly reduced its debt levels, eliminating external debt by 2024, which improves its financial stability. The equity ratio is strong, suggesting prudent management of assets relative to equity. However, the return on equity remains moderate, indicating room for improvement in profitability relative to shareholder equity.

Cash Flow

Neutral

The company's operating cash flow has decreased significantly from previous highs, impacting the free cash flow generation. Although the company has achieved positive free cash flow in 2024, the growth rate is not robust, and prior volatility in free cash flow may pose risks. The ratio of operating cash flow to net income is reasonable, indicating a transition to more sustainable cash generation.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
578.08M	607.03M	821.38M	1.14B	965.80M	1.24B
	Gross Profit
602.65M	462.38M	784.73M	721.24M	621.36M	750.35M
	EBIT
133.89M	131.87M	304.87M	-199.20M	-124.63M	-704.75M
	EBITDA
231.24M	165.57M	426.82M	220.39M	415.06M	54.51M
	Net Income Common Stockholders
190.69M	70.52M	185.28M	-421.29M	-216.82M	-2.46B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
252.14M	302.15M	345.33M	918.25M	1.60B	703.54M
	Total Assets
3.46B	3.51B	3.56B	11.03B	14.20B	20.20B
	Total Debt
412.58M	339.71M	420.82M	5.45B	4.86B	7.79B
	Net Debt
160.44M	37.56M	75.48M	4.53B	3.26B	7.09B
	Total Liabilities
941.38M	1.02B	1.05B	6.46B	8.93B	12.91B
	Stockholders Equity
1.82B	1.96B	1.81B	1.66B	2.15B	2.50B
Cash Flow		Free Cash Flow
136.59M	56.53M	233.64M	-1.88B	-121.69M	-2.04B
	Operating Cash Flow
137.43M	60.12M	233.64M	262.58M	248.24M	89.89M
	Investing Cash Flow
18.61M	-11.22M	-979.04M	-1.91B	146.56M	-1.93B
	Financing Cash Flow
-78.83M	-90.84M	58.15M	923.78M	411.26M	1.37B

DigitalBridge Group Technical Analysis

Technical Analysis Sentiment

Positive

Last Price11.95

Price Trends

50DMA

8.79

Positive

100DMA

9.87

Positive

200DMA

11.63

Positive

Market Momentum

MACD

0.56

Negative

RSI

80.77

Negative

STOCH

92.75

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DBRG, the sentiment is Positive. The current price of 11.95 is above the 20-day moving average (MA) of 8.97, above the 50-day MA of 8.79, and above the 200-day MA of 11.63, indicating a bullish trend. The MACD of 0.56 indicates Negative momentum. The RSI at 80.77 is Negative, neither overbought nor oversold. The STOCH value of 92.75 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DBRG.

DigitalBridge Group Risk Analysis

DigitalBridge Group disclosed 48 risk factors in its most recent earnings report. DigitalBridge Group reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

DigitalBridge Group Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AAT	73 Outperform	$1.22B	14.83	6.74%	6.84%	12.64%	49.11%
DBRG	71 Outperform	$2.25B	37.56	10.58%	0.34%	-56.43%	-82.25%
UE	69 Neutral	$2.51B	29.79	6.48%	3.74%	6.18%	-72.21%
GOOD	65 Neutral	$663.96M	49.27	7.51%	8.42%	3.01%	―
SAFE	60 Neutral	$1.12B	10.37	4.51%	4.62%	1.54%	―
Sector *	60 Neutral	$2.82B	10.41	0.43%	8531.49%	6.00%	-17.35%
GNL	60 Neutral	$1.78B	―	-13.01%	12.72%	16.69%	39.04%

* Real Estate Sector Average

Performance Comparison

DBRG

DigitalBridge Group

11.95

-1.52

-11.28%

GOOD

Gladstone Commercial

14.25

0.80

5.95%

SAFE

Safehold

15.66

-4.06

-20.59%

AAT

American Assets

19.94

-1.02

-4.87%

Urban Edge Properties

18.98

2.32

13.93%

GNL

Global Net Lease

7.98

1.18

17.35%

DigitalBridge Group Earnings Call Summary

Earnings Call Date:May 01, 2025

(Q1-2025)

% Change Since: 42.26%|

Next Earnings Date:Jul 31, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance, successful fundraising, and strategic acquisitions, indicating resilience in digital infrastructure despite market volatility and some fundraising delays. However, concerns about trade policy impacts and a reversal in carried interest were noted.

Q1-2025 Updates

Positive Updates

Strong Financial Performance

DigitalBridge reported fee revenues of $90 million and FRE of $35 million, up almost 80% year-over-year. Distributable earnings were $55 million, including a $34 million gain from the partial realization of the DataBank investment.

Successful Fundraising

The company raised $1.2 billion in the quarter, with significant commitments to the flagship DigitalBridge Partner strategy, amounting to over 70% of total fundraising. The company also highlighted a strong pipeline in private credit, with over 100 accounts evaluating the strategy.

Zayo Acquisition

DigitalBridge supported Zayo's $4.5 billion acquisition of Crown Castle's fiber business, increasing Zayo's scale by over 50% and adding 90,000 route miles to its existing network.

Resilience of Digital Infrastructure

Digital infrastructure proved resilient amidst market volatility, with long-term contracts and inflation protection contributing to stability. The company highlighted the low correlation of infrastructure to other asset classes.

Growth in Private Credit

DigitalBridge's private credit platform showed significant growth potential, with a pipeline of $13 billion in new loan origination opportunities and plans to deploy up to $2 billion in 2025.

Negative Updates

Market Volatility and Fundraising Delays

Some final fundraising decisions were delayed due to LPs monitoring uncertain market conditions. However, the company remains confident in achieving its goals for 2025.

Impact of Trade Policy on Data Centers

Trade tariffs and policy could impact data center construction costs by 3% to 7%, but the company expects to recover most of these costs in new contracts.

Reversal of Carried Interest

A $5 million reversal of carried income was reported due to net increases in the fair value of portfolio assets being slightly below the preferred return hurdle on certain funds.

Company Guidance

During the first quarter of 2025 earnings call, DigitalBridge Group outlined its financial performance, highlighting key metrics that indicate strong growth and resilience. The company reported fee revenues of $90 million, reflecting an impressive 24% increase over the first quarter of 2024, and fee-related earnings (FRE) of $35 million, up nearly 80% year-over-year. Additionally, DigitalBridge raised $1.2 billion in the quarter, primarily driven by commitments to its flagship strategy, and increased its fee-earning equity under management (FEEUM) to $37.3 billion, marking a 15% rise from the previous year. This growth was supported by a robust pipeline in private credit, with expectations to deploy up to $2 billion in 2025. Despite some short-term market volatility impacting final fundraising decisions, the company remains confident in achieving its 2025 goals, supported by the intrinsic resilience of its diversified digital infrastructure portfolio.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.