Equinix: Global Connection Hub for the Internet

Investment Thesis

Equinix (EQIX) is the #1 network neutral
co-location provider in the world. <!--more--> Industry dynamics favor the
company due to customer demand growth exceeding co-lo supply.
This is primarily driven by the growth in internet traffic and bandwidth
intensive content. EQIX has a highly defensible business model
insulated by the benefits that customers receive from “inter-connecting”
within EQIX data centers. Hence, the customer barriers to exit
are high and Equinix garners a 95% recurring revenue stream. EQIX’s
global footprint spans 39 datacenter in 10 countries across 3 continents.
Shares have been hammered over the past 6 months, fueled by a misinformed
report by Off The Record Research and the Street’s poor understanding
of the business fundamentals. EQIX represents an attractive investment
opportunity that we value at $130, almost 80% above current levels.