3 reasons to buy NextDC shares today

A leading analyst believes NextDC shares are well-positioned to deliver long-term growth.

NextDC Ltd (ASX: NXT) shares have been frozen all week. Shares closed last Friday trading for $14.12 each and have remained there through to market close on Tuesday.

But that's going to change when the market opens on Wednesday.

As you may be aware, shares in the S&P/ASX 200 Index (ASX: XJO) data centre operator and developer entered a trading halt before market open on Monday.

Management requested the pause in trading prior to releasing the results of institutional equity raising.

That update should be out before the ASX opens this morning. Investors will then learn more details regarding how much capital NextDC is raising and how it plans to use the new funds.

Which brings us back to our headline question…

Two IT professionals walk along a wall of mainframes in a data centre discussing various things

Image source: Getty Images

Should you buy NextDC shares today?

Last week, before NextDC shares entered a trading halt, Red Leaf Securities' John Athanasiou released a bullish note on the ASX 200 tech stock (courtesy of The Bull).

"Australia's leading data centre operator provides connectivity and colocation services to cloud, enterprise and government clients across Australia and the Asia Pacific," he said.

Citing the first reason he's optimistic on the company's outlook, Athanasiou said, "Its network of certified facilities underpins critical digital infrastructure amid surging demand for cloud, artificial intelligence and high-performance computing."

As for the second reason you might want to buy NextDC shares today, he added, "NextDC recently launched a $1 billion hybrid securities offer to fund expansion. A strong forward order book reflects institutional confidence in its long-term growth."

The company announced the hybrid securities deal on 7 April. NextDC CEO Craig Scroggie said the deal "represents another step toward NextDC delivering on a material step-change in the scale of our business".

Rounding off with the third reason the stock looks well placed to outperform, Athanasiou concluded:

The company continues to build new facilities and sign strategic partnerships, positioning it to capture structural tailwinds in digital transformation and infrastructure demand.

What else has been happening with the ASX 200 tech stock this week?

Although NextDC shares have been frozen since Friday, it's been a busy week for the data centre company.

On Monday, the company released an operational update revealing strong growth metrics over the three months to 31 March.

Among the highlights likely to pique investor interest, NextDC a 60% increase in its contracted utilisation to 667 megawatts (MW). The company revealed that its forward order book had grown by 83% to 544MW.

And NextDC reaffirmed the its full year FY 2026 revenue and underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) guidance to be in the range of $230 million to $240 million.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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