Shares of Equinix (EQIX) surged 17 percent Wednesday after several analysts raised their ratings on the stock after a conference call with management Tuesday afternoon. Equinix rose $17.04, or 17.1 percent, to close at $116.66 Wednesday. At one point, the stock traded as high as $121.13.
Equinix reported a profit of $4.1 million, or 12 cents per share, versus a loss of $5.2 million, or 18 cents per share, in the year-ago period. The company also raised its revenue guidance, projecting 2007 revenue of $$416 million to $417.5 million, compared with its previous view of $413 million to $415 million. Beyond the performance, analysts were encouraged by reports of strong demand in both the U.S. and Europe, a market Equinix just entered with its acquisition of IXEurope.
"Our pipeline remains extremely strong with another record bookings quarter," Equinix president and CEO Stephen Smith told analysts on the conference call. "Importantly, we've seen our investments in our systems and processes start to pay off." Equinix said revenues at a new data center in northern Virginia were running ahead of schedule, as were bookings for a new facility in Chicago. The company also announced expansions of data centers in Paris and Sydney, and said demand in Paris and London remains strong.
CIBC World Markets analyst Srinivas Anantha upgraded Equinix to "Sector Outperformer" from "Sector Performer," with a $125 price target, according to Reuters. The analyst cited the company's "superior growth profile and consistent execution."
Kaufman Brothers analyst Manuel Recarey upgraded Equinix to "Buy" from "Hold" and raised his price target to $120 from $96. "We think as long as the company continues to exceed expectations, momentum should continue to drive the stock higher," Recarey said in a client note.
