NEXTDC Ltd (ASX: NXT) shares surged 50% to $9.85 on Thursday following some major news.
That's an extraordinary gain in a single day, especially for a company of its size.
But has the rally gone too far, or could the shares still be worth buying?
What's behind the 50% jump?
The excitement followed news that Goodman Group (ASX: GMG) and US-listed Digital Realty Trust (NYSE: DLR) had launched a joint effort to acquire a stake in NEXTDC.
Through a jointly owned investment vehicle, the companies offered to purchase up to 9.9% of NEXTDC at $9.50 per share.
That represented a substantial 45.5% premium to Wednesday's closing price of $6.53.
I think this is a significant development for NEXTDC. Goodman has become a major player in global data centre development, while Digital Realty is one of the world's largest data centre operators.
Both understand the industry, the enormous investment required to build facilities, and the opportunities created by growing demand for computing power.
And the fact that they're prepared to pay $9.50 per share suggests they see considerable value in NEXTDC's assets and long-term prospects.
Of course, their willingness to pay that price doesn't guarantee the shares are worth more. Strategic investors may also have reasons for acquiring a stake that extend beyond the potential financial returns.
Nevertheless, I think it's encouraging to see two experienced operators show such confidence.
NEXTDC's board has described the move as opportunistic, coming shortly after the company's recent problems at its M3 Melbourne data centre.
Those problems caused management to cut FY27 underlying EBITDA guidance from $385 million to $410 million to just $245 million to $265 million.
That was a major disappointment and understandably caused investors to question the company's near-term outlook. However, Goodman and Digital Realty appear to see an opportunity in the weakness.
The companies have indicated they don't currently intend to make a takeover bid, although they've reserved the right to do so. I think their involvement could also encourage greater interest in NEXTDC from other infrastructure investors.
Would I still buy?
I think NEXTDC has an enormous opportunity to grow its earnings over the coming years, and that's the main reason I would consider investing.
Much of this potential comes from its substantial contracted order book. At the end of FY26, NEXTDC had approximately 740MW of contracted capacity, with 565MW still waiting to begin generating revenue.
Management previously estimated that its existing contracted capacity could eventually generate more than $1 billion in annual EBITDA once fully operational.
That's a substantial increase on the $249 million delivered in FY26.
Of course, bringing that capacity online will require significant investment, and the recent Melbourne delays demonstrate how challenging that process can be.
But I believe the potential rewards justify taking on those risks, especially at the current share price.
Even after Thursday's 50% rally, NEXTDC shares remain approximately 41% below their 52-week high of $16.78.
While that doesn't automatically make them cheap, I think the interest from Goodman and Digital Realty provides some reassurance about their valuation.
Both companies understand the data centre industry, and their willingness to pay $9.50 per share for a stake in NEXTDC suggests they see considerable value in its assets and long-term growth opportunities.
Foolish takeaway
A 50% gain in a single day is remarkable, but I wouldn't let that alone discourage me from buying NEXTDC shares.
I think the interest from Goodman and Digital Realty reinforces the potential value of its infrastructure and contracted customer relationships.
There's still plenty of work ahead for NEXTDC, and I expect its shares to remain volatile.
However, I'd be happy to buy around current levels and give the company time to deliver on its substantial growth opportunities.
The post Would I buy NEXTDC shares after its 50% jump? appeared first on The Motley Fool Australia.
Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goodman Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Digital Realty Trust. The Motley Fool Australia has positions in and has recommended Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2026