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CyrusOne Inc. February 18, 2015
(CONE-NASDAQ) Company Comment
Frank G. Louthan IV, (404) 442-5867, Frank.Louthan@RaymondJames.com
William A. Crow, (727) 567-2594, Bill.Crow@RaymondJames.com
Alexander Sklar, CPA, Sr. Res. Assoc., (404) 442-5804, Alex.Sklar@RaymondJames.com
Telecommunications Services: Wireline___________________________________
Low Oil Prices Can't Hold CONE Down; Raising PT
Recommendation: We maintain our Strong Buy rating on CyrusOne. CyrusOne continues to
deliver growth in the sector as it expands and diversifies its customer base and utilizes its sales
skills in large enterprise to capture demand. We believe internal returns are rising as
demonstrated by its outsized dividend hike (50%) that was announced.
Event: CyrusOne beat 4Q results with revenue and adj. EBITDAS of $86.9 million and $44.6
million vs. our $85.6 million and $43.8 million estimates. FFO/share and AFFO/share for the
quarter were $0.48 and $0.46 vs. our $0.43 and $0.40 estimates. 2015 guidance appears
conservative, in our view, as management consistently beats expectations.
Installed base growth. New MRR signed in the quarter of $950,000, was slightly below
the company’s two-year average of $1.1 million (~in line when factoring the y/y shift to
metered power), however, new revenue from existing customers was very strong up
$768,000 MRR in the quarter vs. its $692,000 MRR previous seven-quarter average. New
customer adds are necessary for long-term sustainable growth, but we believe these
deals are lumpier quarter to quarter given the sales cycle and the above average installed
base growth at favorable rates continues to be a positive sign of demand given the
estimated ~40% customer NPV that comes in after the initial deployment.
Metered power transition. 78% of new leased sq. ft. was to metered power customers,
slightly below the recent ~80-90% run-rate. This is a notable shift since the company’s
2013 IPO when metered power contracts represented only ~40% of total revenue. The
company picks up essentially no margin on that piece of revenue, which should push
margins closer to 50% over the next two years. The offset here is metered power
customers sign longer contracts, have lower churn, and it can help decrease overhead.
Weaker oil? Not a problem. Management gave meaningful stats defining why lower oil
prices and Texas economic exposure would not be a concern. Of note to us is that
revenue from its 10 largest energy customers equals ~0.006% of their combined LTM
opex, and the last time oil was below $40, growth didn’t slow.
Estimates: We are lowering our 2015 revenue and EBITDA estimates to the upper end of
what we believe to be a conservative guidance range. Our 2015E FFO and AFFO/share go to
$1.98 and $1.93 from $1.99 and $1.85, and we are introducing 2016 estimates.
Valuation: We are raising our price target on CONE to $34 based on 13x our 2016E EBITDAS vs.
the REIT data center group at 13.5x, which we believe is appropriate given CONE’s strong
revenue and AFFO growth profile. Our PT also represents 15x AFFO, in line with the group at 15x.
AFFO Q1 Q2 Q3 Q4 Full Revenues
/Share Mar Jun Sep Dec Year (mil.)
2013A $0.27 $0.23 $0.30 $0.32 $1.12 $264
Old2014E 0.42A 0.39A 0.45A 0.40 1.65 330
New2014A 0.42 0.39 0.45 0.46 1.71 331
Old2015E 0.43 0.44 0.46 0.52 1.85 388
New2015E 0.46 0.46 0.48 0.53 1.93 381
Old2016E NA NA NA NA NA NA
New2016E UR UR UR UR 2.23 437
Rows may not add due to rounding. UR: Under Review.
Rating _________________________________
Strong Buy 1
Current and Target Price __________________
Current Price (Feb-18-15 close) $30.16
Target Price: Old: $30.00 New: $34.00
52-Week Range $29.40 - $19.52
Suitability Aggressive Growth
Market Data____________________________
Shares Out. (mil.) 65.3
Market Cap. (mil.) $1,969
Avg. Daily Vol. (10 day) 369,130
Dividend/Yield $1.26/4.2%
Book Value (Dec-14) $10.99
ROE % NM
LT Debt (mil.)/% Cap. $660/42%
Earnings & Valuation Metrics ______________
2013A 2014A 2015E 2016E
P/AFFO
26.9x 17.6x 15.6x 13.5x
Adj. EBITDAS (mil.)
Old $139 $169 $199 NA
New $139 $169 $192 $223
Net Operating Income (mil.)
Old $170 $205 $241 NA
New $170 $206 $231 $267
Company Description ____________________
CyrusOne Inc., based in Carrollton, Texas, operates
carrier neutral data center and colocation services to
large enterprises in the U.S., Europe, and Asia. The
company is structured as a REIT and operates 25 data
centers across ten markets primarily in Texas and the
Midwest. CyrusOne currently has over 500 customers
including approximately half of the Fortune 20 and
over 100 of the Fortune 1000.

Raymond James U.S. Research
International Headquarters: The Raymond James Financial Center | 880 Carillon Parkway | St. Petersburg, Florida 33716 | 800-248-8863 2
CyrusOne, Inc.
Income Statement
Q1 Q2 Q3 Q4 2013 Q1 Q2 Q3 Q4 2014 Q1E Q2E Q3E Q4E 2015E 2016E
Revenue 60.1 63.6 67.5 72.3 263.5 77.5 81.7 84.8 86.9 330.9 89.4 92.7 97.2 101.5 380.9 437.1
y/y growth 15.4% 17.8% 19.0% 24.7% 19.3% 29.0% 28.5% 25.6% 20.2% 25.6% 15.4% 13.5% 14.6% 16.8% 15.1% 14.7%
q/q growth 3.6% 5.8% 6.1% 7.1% 7.2% 5.4% 3.8% 2.5% 2.9% 3.6% 4.8% 4.5%
Costs and Expenses:
Property Operating Expenses 20.1 24.6 24.2 24.3 93.2 27.7 31.8 33.0 32.0 124.5 34.4 37.2 39.2 39.3 150.1 170.0
% of Revenue 33.4% 38.7% 35.9% 33.6% 35.4% 35.7% 38.9% 38.9% 37.5% 37.6% 38.5% 40.1% 40.3% 38.7% 39.4% 38.9%
Sales and Marketing 2.8 2.9 2.3 2.6 10.6 3.0 3.5 3.2 3.1 12.8 3.2 3.4 3.5 3.6 13.7 16.0
General and Administrative 6.9 7.1 7.2 6.8 28.0 7.3 8.4 9.0 9.9 34.6 9.4 9.5 9.6 9.7 38.2 41.0
Depreciation and Amortization 21.7 23.0 23.9 26.6 95.2 27.6 29.8 30.0 30.6 118.0 31.5 32.3 33.3 34.2 131.3 144.7
Acquisition Costs 20.1 0.4 0.7 - 21.2 0.1 0.8 - - 0.9 - - - - - -
Restructuring Costs 1.4 0.2 1.6 - 0.1 0.1 - -
Asset Impairments 2.8 2.8 - - - -
Total Costs and Expenses 71.6 58.0 59.0 63.3 251.9 65.7 74.3 75.2 75.7 290.9 78.6 82.3 85.5 86.8 333.3 371.7
Operating Income (11.5) 5.6 8.5 9.0 11.6 11.8 7.4 9.6 11.2 40.0 10.9 10.4 11.7 14.7 47.6 65.3
Interest Expense 10.9 10.8 10.5 11.5 43.7 10.7 10.7 9.0 9.1 39.5 9.6 9.8 10.1 10.4 39.9 44.3
Loss on Extinguishment of Debt - 1.3 (0.1) 1.2 13.6 13.6 - -
Income Before Income Taxes (22.4) (6.5) (1.9) (2.5) (33.3) 1.1 (3.3) 0.6 (11.5) (13.1) 1.3 0.6 1.5 4.3 7.7 21.0
Income Tax Expense 0.6 0.3 0.3 1.1 2.3 0.4 0.3 0.4 0.3 1.4 0.4 0.4 0.4 0.4 1.6 1.6
Tax Rate -2.7% -4.6% -15.8% -44.0% -6.9% 36.4% -9.1% 66.7% -2.6% -10.7% 30.8% 72.5% 25.9% 9.3% 20.8% 7.6%
Income from Continuing Operations (23.0) (6.8) (2.2) (3.6) (35.6) 0.7 (3.6) 0.2 (11.8) (14.5) 0.9 0.2 1.1 3.9 6.1 19.4
Loss on Sale of Real Estate Improvements 0.2 0.2 - - -
Noncontrolling Interests (22.1) (4.5) (1.4) (2.5) (30.5) 0.5 (2.5) 0.1 (4.8) (6.7) - -
Net Income (0.9) (2.3) (0.8) (1.3) (5.3) 0.2 (1.1) 0.1 (7.0) (7.8) 0.9 0.2 1.1 3.9 6.1 19.4
EPS (0.01)$ (0.04)$ (0.01)$ (0.02)$ (0.08)$ 0.00$ (0.02)$ 0.00$ (0.11)$ (0.12)$ 0.01$ 0.00$ 0.02$ 0.06$ 0.09$ 0.29$
Add: Stock-based comp. mark-to-market - - - - - - - - - - - - - - - -
Adj. EBITDAS 31.5 30.8 36.5 39.9 138.7 41.7 40.8 42.2 44.6 169.3 45.4 46.3 48.3 52.3 192.3 222.7
Margin 52.4% 48.4% 54.1% 55.2% 52.6% 53.8% 49.9% 49.8% 51.3% 51.2% 50.7% 50.0% 49.7% 51.5% 50.5% 51.0%
y/y growth 10.1% 8.1% 21.7% 40.5% 20.1% 32.4% 32.5% 15.6% 11.8% 22.1% 8.8% 13.5% 14.5% 17.3% 13.6% 15.8%
NOI 40.0 39.0 43.3 48.0 170.3 49.8 49.9 51.8 54.9 206.4 55.0 55.5 58.0 62.2 230.8 267.1
Margin 66.6% 61.3% 64.1% 66.4% 64.6% 64.3% 61.1% 61.1% 63.2% 62.4% 61.5% 59.9% 59.7% 61.3% 60.6% 61.1%
y/y growth 14.9% 8.6% 18.0% 28.3% 17.6% 24.5% 27.9% 19.6% 14.4% 21.2% 10.5% 11.3% 12.0% 13.4% 11.8% 15.7%
FFO/AFFO
Net Income (23.0) (6.8) (2.2) (3.8) (35.8) 0.7 (3.6) 0.2 (11.8) (14.5) 0.9 0.2 1.1 3.9 6.1 19.4
+ Loss on Sale of Real Estate Improvements - - - 0.2 0.2 - - - - - - - - - - -
+ Real Estate Depreciation and Amortization 15.9 16.9 17.8 20.0 70.6 22.2 24.1 24.5 25.1 95.9 25.9 26.7 27.6 28.5 108.6 122.3
+ Real estate impairments - 2.8 2.8 - - -
FFO (7.1) 10.1 15.6 19.2 37.8 22.9 20.5 24.7 13.3 81.4 26.8 26.8 28.7 32.4 114.7 141.7
+ Amort. of Cust. Relationship Intangibles 4.2 4.2 4.2 4.2 16.8 4.2 4.3 4.2 4.2 16.9 4.2 4.2 4.2 4.2 16.8 16.8
+ Transaction Costs 20.1 1.7 2.1 0.2 24.1 0.1 0.8 - 13.7 14.6 - - - - - -
FFO, as Adjusted 17.2 16.0 21.9 23.6 78.7 27.2 25.6 28.9 31.2 112.9 31.0 31.0 32.9 36.6 131.5 158.5
FFO/sh 0.27$ 0.25$ 0.34$ 0.37$ 1.22$ 0.42$ 0.39$ 0.44$ 0.48$ 1.73$ 0.47$ 0.47$ 0.50$ 0.55$ 1.98$ 2.37$
+ Amortization of deferred financing costs 0.6 1.7 0.5 1.3 4.1 0.9 0.9 0.9 0.7 3.4 0.7 0.7 0.7 0.7 2.8 2.8
+ Non-cash stock based comp 1.2 1.8 2.0 1.3 6.3 2.2 2.8 2.6 2.7 10.3 3.0 3.6 3.4 3.4 13.4 12.7
+ Non-real estate depreciation & amortization 1.6 1.9 1.9 2.4 7.8 1.2 1.4 1.2 1.4 5.2 1.5 1.4 1.5 1.6 5.9 5.6
- Straight line rent adjustment, net (2.3) (3.7) (3.7) (4.2) (13.9) (3.0) (3.7) (1.5) (2.3) (10.5) (2.7) (2.8) (2.9) (3.0) (11.4) (13.1)
- Recurring real estate capex (0.3) (0.4) (1.6) (1.7) (4.0) (0.4) (0.3) (2.1) (1.0) (3.8) (1.7) (1.8) (1.9) (2.0) (7.5) (8.8)
- Capitalized leasing commissions (0.9) (2.5) (1.7) (1.9) (7.0) (0.6) (1.4) (0.9) (2.9) (5.8) (1.8) (1.9) (1.9) (2.0) (7.6) (8.7)
- Corporate Income Tax (Benefit) 0.4 - - - 0.4 - - - - - - - - - - -
AFFO 17.5 14.8 19.3 20.8 72.4 27.5 25.3 29.1 29.8 111.7 29.9 30.3 31.7 35.1 127.0 149.0
AFFO/sh 0.27$ 0.23$ 0.30$ 0.32$ 1.12$ 0.42$ 0.39$ 0.45$ 0.46$ 1.71$ 0.46$ 0.46$ 0.48$ 0.53$ 1.93$ 2.23$
y/y growth 48.3% -9.8% 55.8% 54.1% 33.8% 57.1% 70.9% 50.8% 43.3% 54.3% 8.6% 19.8% 9.0% 17.8% 13.7% 17.3%
Diluted Shares Outstanding: 64.5 64.7 64.7 64.6 64.6 65.0 65.3 65.3 65.3 65.3 65.6 65.8 66.1 66.4 66.4 66.9
Dividend/share 0.16$ 0.16$ 0.16$ 0.16$ 0.64$ 0.21$ 0.21$ 0.21$ 0.21$ 0.84$ 0.32$ 0.32$ 0.32$ 0.32$ 1.26$ 1.44$
Total Dividend Payment 10.3 10.4 10.4 10.3 41.4 13.7 13.7 13.7 13.7 54.8 20.7 20.7 20.8 20.9 83.1 96.0
Capital Expenditures:
Total 52.6 48.7 63.6 83.2 248.1 49.7 67.1 78.1 89.3 295.2 51.7 51.8 66.9 62.0 232.5 208.8
Developmental Yield 18.7% 16.4% 17.4% 18.1% 18.4% 16.9% 17.3% 17.5% 16.9% 16.4% 16.4% 16.9%
Source: Company Reports & Raymond James Estimates

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Ratings and Definitions
Raymond James & Associates (U.S.) definitions
Strong Buy (SB1) Expected to appreciate, produce a total return of at least 15%, and outperform the S&P 500 over the next six to 12 months.
For higher yielding and more conservative equities, such as REITs and certain MLPs, a total return of at least 15% is expected to be realized
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Raymond James Ltd. (Canada) definitions
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over the next six months.
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Market Perform (MP3) The stock is expected to perform generally in line with the S&P/TSX Composite Index over the next twelve months and
is potentially a source of funds for more highly rated securities.
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and should be sold.
Raymond James Latin American rating definitions
Strong Buy (SB1) Expected to appreciate and produce a total return of at least 25.0% over the next twelve months.
Outperform (MO2) Expected to appreciate and produce a total return of between 15.0% and 25.0% over the next twelve months.
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Outperform (2) Expected to appreciate and outperform the Stoxx 600 over the next 12 months.
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Rating Distributions
Coverage Universe Rating Distribution* Investment Banking Distribution
RJA RJL RJ LatAm RJ Europe RJA RJL RJ LatAm RJ Europe
Strong Buy and Outperform (Buy) 54% 64% 50% 44% 25% 39% 0% 0%
Market Perform (Hold) 40% 34% 50% 35% 9% 22% 0% 0%
Underperform (Sell) 6% 2% 0% 21% 2% 0% 0% 0%
* Columns may not add to 100% due to rounding.
Suitability Categories (SR)
Total Return (TR) Lower risk equities possessing dividend yields above that of the S&P 500 and greater stability of principal.
Growth (G) Low to average risk equities with sound financials, more consistent earnings growth, at least a small dividend, and the potential
for long-term price appreciation.
Aggressive Growth (AG) Medium or higher risk equities of companies in fast growing and competitive industries, with less predictable earnings
and acceptable, but possibly more leveraged balance sheets.
High Risk (HR) Companies with less predictable earnings (or losses), rapidly changing market dynamics, financial and competitive issues,
higher price volatility (beta), and risk of principal.
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with success, and a substantial risk of principal.

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next three months.
Company Name Disclosure
CyrusOne Inc. Raymond James & Associates makes a market in shares of CONE.
Stock Charts, Target Prices, and Valuation Methodologies
Valuation Methodology: The Raymond James methodology for assigning ratings and target prices includes a number of qualitative and
quantitative factors including an assessment of industry size, structure, business trends and overall attractiveness; management effectiveness;
competition; visibility; financial condition, and expected total return, among other factors. These factors are subject to change depending on
overall economic conditions or industry- or company-specific occurrences. Only stocks rated Strong Buy (SB1) or Outperform (MO2) have
target prices and thus valuation methodologies.
Target Prices: The information below indicates our target price and rating changes for CONE stock over the past three years.
Valuation Methodology: We value CONE based on an AFFO and EV/EBITDAS analysis. These are conventional and primary valuation metrics
employed by most REIT and technology, media, and telecom investors.
Risk Factors
General Risk Factors: Following are some general risk factors that pertain to the projected target prices included on Raymond James research:
(1) Industry fundamentals with respect to customer demand or product / service pricing could change and adversely impact expected
revenues and earnings; (2) Issues relating to major competitors or market shares or new product expectations could change investor attitudes
toward the sector or this stock; (3) Unforeseen developments with respect to the management, financial condition or accounting policies or
practices could alter the prospective valuation; or (4) External factors that affect the U.S. economy, interest rates, the U.S. dollar or major
segments of the economy could alter investor confidence and investment prospects. International investments involve additional risks such as
currency fluctuations, differing financial accounting standards, and possible political and economic instability.
Specific Investment Risks Related to the Industry or Issuer
Wireline Telecom Services Risk Factors
Wireline telecom services remain highly regulated, and should regulation become less favorable, promoting more competition or reducing
subsidies for these companies, the sector could be negatively impacted. Technological substitution remains a highly credible threat toward
most wireline telecom services companies' revenue and earnings. A large amount of debt could leverage the industry to the downside should
earnings and cash flows face significant pressure.

Company-Specific Risks for CyrusOne, Inc.
Customer/Location Concentration
The largest risk to CyrusOne investors is its customer concentration. The company’s top 10 customers represent a significant portion of its
annualized rent and tloss of a major customer may negatively affect the company’s results. Additionally, a majority of the company's revenue
comes from facilities that are located in Texas and Ohio. While the company has had success in both of these markets, there is no guarantee
that new entrants into these markets and/or degrading regional economic conditions will not harm the company’s future results.
Failure of Facility Infrastructure
Data centers are expected to be operational 99.999% of the time, and any power failures or disruptions could cause customers to switch
providers. In addition, power failures would hinder its ability to gain new customers and drive additional products such as managed hosting.
Additional Risk and Disclosure information, as well as more information on the Raymond James rating system and suitability
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