Mon, Jul. 11, 10:09 AM
- Crown Castle International (NYSE:CCI) is off 2.2% as Citigroup downgrades the shares to Neutral following tower stocks' recent gains.
- CCI is coming off Wednesday's all-time high, and the downgrade comes following a solid run for high dividend payers.
- It's time to shift investment strategy for towers and seek cheaper assets, says Citi's Michael Rollins, who maintained Buy ratings on American Tower (AMT -0.2%) and SBA Communications (SBAC -0.3%). "Tower stocks have rallied back 9% over the last month and 15% year to date. Lower rates seem to be helping valuations, especially for Crown Castle given its larger dividend yield," Rollins writes.
- Rollins has a price target of $109 on CCI, implying 8.9% upside from today's lower price. Meanwhile, Citi has a price target of $121 on AMT (6.7% upside from here).
Tue, Feb. 23, 7:24 PM
- Deutsche Bank launched coverage of U.S. telecom companies late today, picking "select pockets of opportunity" in a challenging sector.
- Specifically, the firm's Matthew Niknam has three top growth picks: T-Mobile (TMUS +1%), Crown Castle International (CCI -0.5%), and American Tower (AMT -1.4%), all rated Buy.
- He assigned a $46 price target to T-Mobile, implying 27% upside from today's close of $36.20, noting "best-in-class growth, margin/FCF expansion, and strategic appeal to potential industry partners." A price target of $98 implies 13.5% upside for Crown Castle, while a target of $104 implies 18.2% upside for AMT.
- Of the group, AT&T (T -0.4%) and Frontier (FTR +12.6%) also received Buys, with respective price targets of $40 (8.9% upside) and $5.50 (8.3% upside from today's significantly higher close).
Tue, Jan. 19, 5:04 PM
- After largely holding up today following a Friday tumble, Sprint (NYSE:S) sank in late afternoon to finish down another 8.5% today and hit another new 52-week low.
- Sprint fell nearly 10% Friday after a Re/code report detailing an ambitious plan to relocate equipment from private towers to government-owned spaces -- though earlier, analysts like Jonathan Schildkraut noted that there are years left on some contracts.
- Tower firms largely bounced back after declining along with Sprint Friday; AMT finished up 2.9%; CCI up 0.5%; while SBAC closed down 1.2%.
- Analysts today lined up with some skepticism: "What is going on and why is Sprint OK with confusion about their network strategy?" asks BTIG's Walter Piecyk. Using wireless backhaul could work, he says, "however, we are highly skeptical of a strategy that cuts the coverage and broad capacity offered by the macro cell site layer ... In addition, the macro cell sites can be important aggregation points to handle the wireless backhaul of small cells."
- And potential savings might not be what they seem, says Cowen's Colby Synesael -- any real estate costs money: "The cost of land is not from our understanding a key component of what drives the overall cost for tower rental fees."
- Previously: Cell tower firms bouncing back after declines on Sprint overhaul report (Jan. 19 2016)
- Previously: Sprint -9.9% as it plans 'radical' network overhaul; tower firms dip (Jan. 15 2016)
Tue, Jan. 19, 11:02 AM
- American Tower (NYSE:AMT) is up 2.6% and Crown Castle International (NYSE:CCI) up 2.1%, each rebounding from declines they saw on Friday amid news that Sprint was looking to overhaul its network to move from private tower leases to government-owned properties.
- Evercore's Jonathan Schildkraut says the tower firms still have years to run (5-6 years on average) on contracts with Sprint, which could face a difficult challenge relocating gear.
- Meanwhile, Pacific Crest's Michael Bowen suggests the tower companies could handle losing revenue from Sprint: "The impact could be most broadly felt by SBA Communications" -- SBAC, down 7.6% Friday but up 0.2% today -- "due to its higher relative exposure to Sprint, with Crown Castle a close second. We expect American Tower to be affected much less because of its lower relative exposure to Sprint and because the company has made significant investments in international markets."
- Previously: Sprint -9.9% as it plans 'radical' network overhaul; tower firms dip (Jan. 15 2016)
Fri, Jan. 15, 5:32 PM
- Sprint (S -9.9%) has a "radical" plan to overhaul its cell network that could save up to $1B -- but might result in hiccups along the way.
- The carrier plans to relocate radio equipment from towers leased from private companies, namely Crown Castle (CCI -5.8%) and American Tower (AMT -4.2%), onto cheaper properties owned by the government, Re/code reports.
- It's also hoping to reduce its dependency on backhaul from AT&T (T -0.9%) and Verizon (VZ -1%) by using microwave technology a la Clearwire instead. The company cuts annual checks of $1B for backhaul to the two rivals.
- One source says the company's "Next Generation Network" will result in a new wave of disruptions and could end up with less coverage in regions where Sprint has few subscribers: “Getting there is going to be a nightmare ... It’s going to be very, very disruptive.”
- Sprint will lease towers from privately held Mobilitie, which will locate where possible on government-owned ROW.
- “Sprint’s plan is not for the faint of heart,” Wells Fargo's Jennifer Fritzsche writes in a note. “Sprint needs to be solely focused on avoiding mistakes of the past, where network overhauls caused major disruptions in the network’s performance.”
Fri, Jan. 8, 6:15 PM
- American Tower (AMT -1.7%) has priced a senior offering of $1.25B in debt.
- The tower operator priced $750M in senior unsecured notes due 2021 at 3.3%, and issued them at 99.853% of face value. It also priced $500M in senior unsecured notes due 2026 at 4.4%, issued at 99.713% of face value.
- Proceeds of about $1.237B are expected to be used to repay debt (including a 2013 credit facility) and general corporate purposes.
Aug. 19, 2015, 11:45 AM
- South Africa's MTN Group (OTCPK:MTNOY -2.5%) is the latest to discuss a major cell-tower sale, having begun talks with tower operator IHS Holding over a possible $2B deal, Bloomberg reports.
- MTN, with 231M subscribers across a 22-market footprint, has about 19,000 sites in South Africa.
- The deal -- in which MTN could retain a large stake in the towers via a joint venture -- is the latest move in a bit of a wireless asset rush in Africa, with firms like Helios Towers Africa and American Tower (NYSE:AMT) looking to build infrastructure
- IHS is Africa's largest independent tower company but may be racing to the deal against American Tower, which had previously expressed interest.
Aug. 6, 2015, 3:39 PM
- American Tower (NYSE:AMT) is up 1.3% after Morgan Stanley, taking a fresh look at telecom towers firms, upgraded the stock to Overweight, from Equal Weight.
- Analyst Simon Flannery set a price target on the shares at $116, up from $101. The stock closed yesterday at $96.68 and is trading today at $97.85. That comes to an 18.5% upside from current prices.
- It's been a slow year for towers firms, he writes, but he likes the group going into 2016, with telecoms expected to re-accelerate spending.
- He holds an existing Overweight rating on SBA Communications (NASDAQ:SBAC) with its price target raised to $151 from $130 (shares are up 0.2% today to $120.97, implying near 25% upside) and an Overweight on Crown Castle International (NYSE:CCI) with a price target of $94 (shares are down 0.4% today to $81.91, implying near 15% upside).
Jul. 29, 2015, 10:08 AM
- American Tower (NYSE:AMT) is off in early action, -2.2%, after Q2 revenue that grew 13.6% missed expectations slightly.
- Net income fell 43.8%, to $129M, mainly due to $75M in one-time debt retirement costs. Total rental and management revenue grew 14.8% (core growth of 23.2%, and organic core growth of about 7.3%).
- Revenue by segment: Domestic rental and management, $803M (up 21.7%); International rental and management, $351M (up 1.6%); Network Development Services, $20M.
- Cash from operations fell 3.3% to $1.036B for the first half.
- AMT raised its full-year guidance on AFFO to $2.095B-$2.135B (midpoint up 16.5%); adjusted EBITDA of $3.02B-$3.06B (midpoint up 14.7%); and total rental and management revneue of $4.645B-$4.695B (midpoint up 16.6%). Net income is expected at $705M-$735M (midpoint down 10.4%).
- That outlook includes a one-time charge of $92M it expects to take after filing a tax election after which Global Tower Partners REIT wouldn't operate as a separate REIT for tax purposes.
Jul. 10, 2015, 11:18 AM
- American Tower (NYSE:AMT) is up 1% as Pacific Crest boosts its price target to $116, from $114.
- Shares closed yesterday at $94.37 and are currently up to $95.32. Pacific Crest maintains an Overweight rating on the stock.
- The analysts point to its $1.05B acquisition of 4,700 towers from Bharti Airtel in noting that international expansion is critical to American Tower's growth.
- AMT expects international operations to increase organic core revenue 10%, Pacific Crest says.
Jun. 29, 2015, 5:46 PM
- Comcast (NASDAQ:CMCSA) and Twenty-First Century Fox (FOX, FOXA) top the media picks on Barclays' top picks list out today, and SBA Communications (NASDAQ:SBAC) leads the firm's telecom sector picks.
- Comcast has an EV smaller than Disney's -- but an EBITDA 60% larger, as well as comparable free cash flow and EBITDA growth, and is the only vertically integrated media play, Barclays says. It has a $68 price target; shares finished today -1.7% to $59.98.
- Fox, meanwhile, has "the most attractive name" in Barclays' media and advertising coverage; risks over downward guidance revisions and the Murdoch transition are well understood, and the company is outpacing others on growth and has exposure to key international markets. Barclays' price target: $39; FOXA closed today -2% to $32.29.
- SBAC, meanwhile, replaces American Tower (NYSE:AMT) as Barclays' top telecom pick, in part due to the company's buyback authorization. With industry fundamentals improving, the bank expects SBAC to deliver AFFO growth of 15%-20% per year, better than peers, and it sees 15% share price upside. The price target is $136; SBAC finished today -1.4% to $115.62.
Apr. 1, 2015, 5:07 PM
- American Tower (NYSE:AMT) gained 2.5% as Raymond James upgraded shares to Strong Buy, from Outperform.
- Rollout of wireless companies' new spectrum should restart revenue growth in 2016, RJ's Ric Prentiss says, pointing to "second-half 2015 and 2016 leasing trends" with T-Mobile deploying its low-band spectrum, Sprint expanding its high-band, and AT&T and Verizon "spending a steady amount of wireless capex."
- It's a bit of a rebound for a stock that's down 8% from its November high.
- The analysts set a slightly lower price target on the stock, to $112 from $114. Shares closed today at $96.46.
Feb. 27, 2015, 7:31 PM
- Wind Telecomunicazioni -- the Italian unit of Russian telecom VimpelCom (NASDAQ:VIP) -- may be selling its wireless towers to Spain's Abertis Infraestructuras (OTCPK:ABRTY) as soon as the coming week.
- The companies are talking about 6,000 towers that Wind values at as much as €700M ($786M), though other observers peg the value even higher, at €800M ($914M).
- An additional 1,700 towers under discussion could easily boost the deal to that latter figure or even to €900M ($1B).
- Abertis -- chiefly in toll-road management -- is reportedly considering transferring the towers into a unit to be listed on the Madrid exchange, in order to get more cash to shareholders.
- The Spanish firm is winning the deal over competition from American Tower (NYSE:AMT), Mediaset's (OTCPK:MDIUY) EI Towers and a coalition of investment fund F2i SGR and Providence Equity Partners.
- Shares of VimpelCom closed the day up 4.8%; they tracked lower in after-hours trading, -1.5%.
Feb. 24, 2015, 4:58 PM
- American Tower (NYSE:AMT) declined 2.8% today in its first day of trading after an earnings report where the firm guided lower than expectations, as well as announcing a stock offering in connection with its planned $5B purchase of Verizon's cell towers.
- The company will offer 23.5M shares of common stock and 12.5M depositary shares (representing a 1/10 interest in a share of Mandatory Convertible Preferred Stock, Series B).
- The offerings will be separate, but concurrent. Goldman Sachs acts as lead book-runner.
- Proceeds will go to financing the Verizon transaction and associated fees.
- Previously: Verizon reaches $5B sale of towers to American Tower (Feb. 05 2015)
Jan. 22, 2015, 2:24 PM
- American Tower (AMT +1.8%) and (especially) SBA (SBAC +4.2%) are rallying after fellow tower owner Crown Castle beat Q4 revenue estimates (while slightly missing AFFO forecasts) and hiked its 2015 guidance. The S&P is up 0.9%.
- AMT (1.6% dividend yield) is $8 away from a high of $106.31. SBA is $6 away from a high of $122.79.
Dec. 2, 2014, 10:53 AM
- Raymond James has downgraded American Tower (AMT -2.5%) to Outperform from Strong Buy, and Crown Castle (CCI -2.3%) to Market Perform from Outperform. Peer SBA (SBAC -2.2%) is off in sympathy.
- AMT and SBAC have rallied strongly this year; CCI has seen more moderate gains.
- A month ago: Goldman, Macquarie downgrade AMT; CCI receives upgrade and downgrades
American Tower Corp. operates as a real estate investment trust. It operates business through three segments: Domestic Rental and Management, International Rental and Management and Network Development Services. The Domestic Rental and Management segment provides for the leasing of antenna space... More
Industry: Diversified Communication Services
Country: United States
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