One of the most volatile parts of the market is technology. Going from whiz-bang product and service ideas to a profitable and successful company is one of the toughest challenges in the markets.
But it can be one of the most lucrative for investors that can wade through what might work to what will work in technology. But it doesn’t stop there … just as a technology company needs to bring its successful product or service to customers, it also has to keep bringing new innovations. And if it fails to do so, the stock market will punish shareholders relentlessly.
This is where a better alternative exists. And one that is behind most of the leading technology companies providing security without singular product or market risk.
Data centers are what is behind companies such as Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT). And from cloud computing, which continues to advance at triple-digit growth rates, to application support and just data processing — data centers provide the back of the house facilities that makes technology work.
And one of the leaders is Digital Realty Trust (NYSE:DLR). The company has centers around the U.S. and in strategic centers around the world.
Furthermore, DLR continues to perform for investors. For over the past ten years, it has generated an overall total return of 297.58%, or an annual average equivalent of 14.79%, which dwarfs the general stock market as measured by the S&P 500.
Revenues continue to climb with the past three years alone showing average gains of 14.99%. And it runs itself on the lean with management expenses running at a mere 8% of revenues.
DLR pays a dividend that’s been rising by more than 5%-per-year over the past five years alone, providing a current dividend yield of 3.79%.
And while owning very valuable and tough-to-replicate properties, the shares are traded at only 2.45% of its book value of assets.
A vast network of clients in technologies that require DLR’s properties and services provides a long-term reliability for revenues and dividend payouts for shareholders.
Neil George is the editor for Profitable Investing and by company policy does not have any current holdings in the securities mentioned above.