DigitalBridge (DBRG)

Digital infrastructure investor DigitalBridge Group (NYSE:DBRG) missed Wall Street’s revenue expectations in Q4 CY2025, with sales falling 27.6% year on year to $47.9 million. Its GAAP profit of $0.27 per share was significantly above analysts’ consensus estimates.

Company Overview

Transforming from a traditional real estate investor to a digital-focused powerhouse in 2021, DigitalBridge Group (NYSE:DBRG) is a global digital infrastructure investment firm that manages capital and operates assets across data centers, cell towers, fiber networks, and edge infrastructure.

Specialty finance companies provide targeted lending or financial services for specific industries or needs. They benefit from expertise in particular sectors, often reduced competition in specialized niches, and tailored underwriting that can yield higher margins. Challenges include concentration risk in specific industries, difficulty achieving scale efficiencies, and potential vulnerability during sector-specific downturns affecting their specialized markets.

DigitalBridge's competitors include other digital infrastructure investors such as American Tower (NYSE:AMT), Crown Castle (NYSE:CCI), Equinix (NASDAQ:EQIX), and Digital Realty Trust (NYSE:DLR), as well as private equity firms with digital infrastructure portfolios like Blackstone and KKR.

Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. DigitalBridge struggled to consistently generate demand over the last five years as its revenue dropped at a 68.3% annual rate. This wasn’t a great result and suggests it’s a low quality business.

We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. DigitalBridge’s recent performance shows its demand remained suppressed as its revenue has declined by 77.6% annually over the last two years. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, DigitalBridge missed Wall Street’s estimates and reported a rather uninspiring 27.6% year-on-year revenue decline, generating $47.9 million of revenue.

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

DigitalBridge’s full-year EPS flipped from negative to positive over the last five years. This is encouraging and shows it’s at a critical moment in its life.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

Sadly for DigitalBridge, its EPS and revenue declined by 14.1% and 77.6% annually over the last two years. We tend to steer our readers away from companies with falling revenue and EPS, where diminishing earnings could imply changing secular trends and preferences. If the tide turns unexpectedly, DigitalBridge’s low margin of safety could leave its stock price susceptible to large downswings.

In Q4, DigitalBridge reported EPS of $0.27, up from negative $0.12 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects DigitalBridge’s full-year EPS of $0.45 to stay about the same.

Return on equity (ROE) measures how effectively banks generate profit from each dollar of shareholder equity - a critical funding source. High-ROE institutions typically compound shareholder wealth faster over time through retained earnings, share repurchases, and dividend payments.

Over the last five years, DigitalBridge has averaged an ROE of 1.7%, uninspiring for a company operating in a sector where the average shakes out around 10%.

The debt-to-equity ratio is a widely used measure to assess a company's balance sheet health. A higher ratio means that a business aggressively financed its growth with debt. This can result in higher earnings (if the borrowed funds are invested profitably) but also increases risk.

If debt levels are too high, there could be difficulties in meeting obligations, especially during economic downturns or periods of rising interest rates if the debt has variable-rate payments.

DigitalBridge currently has $298.8 million of debt and $2.11 billion of shareholder's equity on its balance sheet, and over the past four quarters, has averaged a debt-to-equity ratio of 0.2×. We think this is safe and raises no red flags. In general, we’re comfortable with any ratio below 3.5× for a financials business.

It was good to see DigitalBridge beat analysts’ EPS expectations this quarter. On the other hand, its revenue missed. Overall, this was a softer quarter. The stock remained flat at $15.25 immediately after reporting.

Updated: February 25, 2026 at 6:02 PM EST

We think that the latest earnings result is only one piece of the bigger puzzle. If you’re deciding whether to own DigitalBridge, you should also grasp the company’s longer-term business quality and valuation.

We see the value of companies driving economic growth, but in the case of DigitalBridge, we’re out. For starters, its revenue has declined over the last five years. And while DigitalBridge’s expanding pre-tax profit margin shows the business has become more efficient, its relatively low ROE suggests management has struggled to find compelling investment opportunities.

DigitalBridge’s P/E ratio based on the next 12 months is 2.2x. This valuation tells us it’s a bit of a market darling with a lot of good news priced in - we think there are better stocks to buy right now.

Wall Street analysts have a consensus one-year price target of $16 on the company (compared to the current share price of $15.25).