DENVER - CoreSite, a provider of hybrid IT solutions and a subsidiary of American Tower Corporation (NYSE: NYSE:AMT), has announced the launch of AWS Direct Connect's native 400 Gbps (400G) Dedicated Connections at select locations, including their Silicon Valley and Northern Virginia data center campuses. This new offering aims to cater to the needs of applications requiring ultra-high-bandwidth and low latency, such as machine learning (ML) training and advanced driver assistance systems (ADAS) for autonomous vehicles.
The native 400G connections are designed to provide private, high-bandwidth connectivity between AWS and on-premises data centers, offices, or colocation facilities, like those offered by CoreSite. This service is set to reduce the operational overhead of managing multiple 100G connections in a link aggregation group, offering a more efficient solution for transferring large-scale datasets.
Juan Font, President and CEO of CoreSite, and SVP of American Tower, highlighted the importance of the new AWS Direct Connect service for customers deploying hybrid applications that require high-performance data transfer capabilities. The CoreSite Silicon Valley data center campus is expanding with the addition of the SV9 facility, a 240,000-square-foot data center expected to be operational in the fourth quarter of 2024. The campus will then feature nine interconnected facilities with a total of 1.179 million square feet of data center space. SV9 is part of the NVIDIA (NASDAQ:NVDA) DGX-Ready Data Center program, positioning it as a prime location for deploying AI-powered, 400G solutions.
In Northern Virginia, CoreSite's data center campus is one of only two providers offering direct connections to all major cloud providers. The campus comprises over 1.3 million square feet across three interconnected data centers, fostering an environment conducive to hybrid IT strategies.
This announcement is based on a press release statement and contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those projected in the forward-looking statements. For more information on risk factors that could affect these projections, refer to American Tower's most recent annual report on Form 10-K and other documents filed with the Securities and Exchange Commission.
In other recent news, American Tower Corporation has seen a flurry of activity. The company has finalized the sale of its Indian subsidiary, ATC India, to Data Infrastructure Trust for approximately $2.5 billion. This strategic move is expected to streamline operations and enhance financial metrics. Following the transaction, BMO Capital Markets raised their price target for American Tower's shares to $260.00, maintaining an Outperform rating.
In addition to this, Citi has reiterated its Buy rating on American Tower, keeping the price target steady at $255.00. Furthermore, Mizuho has updated its outlook on American Tower, raising its price target to $221 due to improved financial forecasts.
The company also announced a quarterly cash distribution of $1.62 per share. This follows consistent performance in the communications infrastructure sector. These are among the latest developments for American Tower Corporation, a leading player in wireless and broadcast communications infrastructure.
InvestingPro Insights
American Tower Corporation (NYSE: AMT), CoreSite's parent company, is demonstrating strong financial performance and market positioning that aligns with its strategic expansion in the data center space. According to InvestingPro data, AMT boasts a substantial market capitalization of $109.16 billion, reflecting its significant presence in the Specialized REITs industry.
The company's revenue growth of 3.89% over the last twelve months, coupled with a robust gross profit margin of 71.45%, underscores its ability to generate value from its operations. This financial strength supports CoreSite's ambitious expansion plans, including the new SV9 facility in Silicon Valley.
InvestingPro Tips highlight that AMT has raised its dividend for 13 consecutive years, with a current dividend yield of 2.79%. This consistent dividend growth aligns with the company's stable cash flow generation, which is crucial for funding large-scale infrastructure projects like data centers.
Moreover, AMT's strong return of 19.86% over the last three months suggests growing investor confidence in the company's strategic direction, including its focus on high-bandwidth solutions like the 400G AWS Direct Connect offering.
For readers interested in a deeper analysis, InvestingPro offers 12 additional tips for AMT, providing a comprehensive view of the company's financial health and market position.
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