GDS (NASDAQ:GDS) Shares Down 6.1% – Time to Sell?

GDS Holdings (NASDAQ:GDS)’s share price was down 6.1% during trading on Wednesday . The company traded as low as $37.76 and last traded at $37.9320. Approximately 832,154 shares traded hands during trading, a decline of 60% from the average daily volume of 2,063,703 shares. The stock had previously closed at $40.41.

Trending Headlines about GDS

Here are the key news stories impacting GDS this week:

• Positive Sentiment: GDS reported Q1 EPS of $1.53, far above the $1.06 consensus and well ahead of the prior-year $0.48 result, signaling better-than-expected profitability. Article
• Positive Sentiment: The company said it saw record data center bookings, which suggests continued demand for its China-based data center capacity and supports future revenue growth. Article
• Positive Sentiment: First-quarter revenue rose 23.6% year over year to RMB3.37 billion, showing that the business is still expanding at a solid pace. Article
• Neutral Sentiment: GDS also announced a board change, with an independent director and audit committee chair resigning for personal reasons and a replacement appointed. This is notable for governance, but it does not appear to be the main driver of the stock move. Article
• Negative Sentiment: Revenue came in slightly below expectations, and one research firm downgraded the stock from strong-buy to hold, which may temper some of the enthusiasm around the earnings beat. Article

Analyst Ratings Changes

A number of equities analysts recently commented on GDS shares. Wall Street Zen upgraded GDS from a “sell” rating to a “hold” rating in a report on Saturday, May 2nd. Weiss Ratings upgraded GDS from a “hold (c-)” rating to a “hold (c)” rating in a report on Monday. Morgan Stanley reiterated an “overweight” rating and set a $64.00 price target on shares of GDS in a report on Tuesday, March 17th. Finally, Zacks Research downgraded shares of GDS from a “strong-buy” rating to a “hold” rating in a report on Monday. One research analyst has rated the stock with a Strong Buy rating, seven have assigned a Buy rating and three have issued a Hold rating to the company. Based on data from MarketBeat, the company currently has a consensus rating of “Moderate Buy” and an average target price of $49.90.

GDS Stock Performance

The stock has a market capitalization of $7.36 billion, a price-to-earnings ratio of 72.73 and a beta of 0.46. The company’s fifty day simple moving average is $42.70 and its 200 day simple moving average is $39.94. The company has a quick ratio of 2.60, a current ratio of 2.60 and a debt-to-equity ratio of 1.60.

GDS (NASDAQ:GDS) last announced its earnings results on Friday, May 15th. The company reported $1.53 earnings per share for the quarter, topping analysts’ consensus estimates of ($0.03) by $1.56. The company had revenue of $426.13 million for the quarter, compared to analyst estimates of $436.44 million. GDS had a return on equity of 8.79% and a net margin of 8.12%.The firm’s quarterly revenue was up 23.7% compared to the same quarter last year. During the same quarter last year, the company earned $3.47 earnings per share. On average, equities research analysts expect that GDS Holdings will post 1.16 earnings per share for the current year.

Hedge Funds Weigh In On GDS

A number of large investors have recently made changes to their positions in GDS. Royal Bank of Canada increased its stake in shares of GDS by 30.7% during the first quarter. Royal Bank of Canada now owns 379,289 shares of the company’s stock worth $9,608,000 after purchasing an additional 89,059 shares during the period. Advisors Asset Management Inc. acquired a new stake in GDS in the 1st quarter worth about $25,000. NewEdge Advisors LLC acquired a new stake in GDS in the 1st quarter worth about $25,000. Northwestern Mutual Wealth Management Co. raised its stake in GDS by 113.0% in the 2nd quarter. Northwestern Mutual Wealth Management Co. now owns 1,836 shares of the company’s stock worth $56,000 after purchasing an additional 974 shares in the last quarter. Finally, EverSource Wealth Advisors LLC raised its stake in GDS by 41.6% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 1,806 shares of the company’s stock worth $55,000 after purchasing an additional 531 shares in the last quarter. Institutional investors own 33.71% of the company’s stock.

About GDS

GDS Holdings Limited, founded in 2001 and headquartered in Shanghai, is a leading network-neutral data center services provider in China. The company operates a portfolio of state-of-the-art data center facilities designed to support the mission-critical IT infrastructure of cloud service providers, internet enterprises, financial institutions, and government entities. GDS was among the first Chinese providers to offer high-density colocation solutions, catering to customers with demanding computing and storage requirements.

GDS specializes in delivering scalable colocation, cross-connect, and interconnection services within its facilities, enabling clients to establish high-speed, low-latency connections to major cloud platforms and internet exchange points.