GDS: 2025 Leasing Pipeline Will Support Long-Term Earnings Upside

Analysts have nudged their fair value estimate for GDS Holdings modestly higher, from about $61.83 to $63.03. They cited supportive Street research that highlights solid long term revenue growth prospects, despite a slightly lower near term price target and mixed quarterly results.

Analyst Commentary

Bullish analysts continue to frame the recent price target adjustments within a constructive long term narrative for GDS Holdings, emphasizing a strengthening growth runway in spite of near term volatility. While one firm trimmed its target marginally, the maintained Buy and Outperform ratings underscore confidence in the company’s ability to execute on its development pipeline and deliver expanding returns on capital.

Recent commentary highlights that the company’s reiteration of 2025 guidance, alongside expectations for robust leasing and installation activity into 2026, supports a multi year earnings growth profile. This, in turn, is seen as underpinning both the higher fair value estimates and sustained upside potential relative to current trading levels.

Bullish Takeaways

• Bullish analysts view the slight reduction in one price target as largely technical, noting that the continued Buy stance signals confidence in the company’s execution and long term value creation.
• Planned 300MW of 2025 leasing and higher installations in 2026 are seen as key catalysts that can accelerate revenue and EBITDA growth, reinforcing the case for multiple expansion over time.
• The initiation of coverage with an Outperform rating and a price target well above the current share price is cited as evidence that the market is still underappreciating the company’s growth trajectory and scale advantages.
• Maintained 2025 guidance despite mixed quarterly results is interpreted as management conviction in the demand outlook, supporting the view that earnings power will improve meaningfully as new capacity comes online.

What's in the News

• Reaffirmed 2025 earnings guidance, with total revenue expected between RMB 11,290 million and RMB 11,590 million, reinforcing visibility into near term growth. (Corporate guidance filing)
• Scheduled board meeting on November 17, 2025, to review unaudited financial results for the third quarter ended September 30, 2025, which could update investors on operational and financial momentum. (Company board notice)

Valuation Changes

• The fair value estimate has risen slightly, increasing from about $61.83 to approximately $63.03 per share.
• The discount rate has declined marginally, moving from roughly 13.05% to about 12.94%, implying a modestly lower perceived risk profile.
• The revenue growth assumption has ticked up slightly, from around 17.42% to approximately 17.50% annually.
• The net profit margin forecast has fallen significantly, dropping from about 6.84% to roughly 3.17%, indicating a more conservative profitability outlook.
• The future P/E multiple has increased sharply, rising from roughly 110.3x to about 207.7x, suggesting a higher valuation placed on expected earnings.