Boston, Massachusetts-based American Tower Corporation (AMT) is a leading global REIT specializing in multitenant communications real estate. Valued at a market cap of $104.6 billion, the company operates a vast network of towers and offers customized collocation solutions across numerous countries worldwide.
Companies worth more than $10 billion are generally described as “large-cap stocks,” and American Tower fits right into that category, with its market cap exceeding this threshold. AMT boasts a portfolio of over 224,000 communications sites and a highly interconnected footprint of U.S. data center facilities.
However, the wireless communications infrastructure company has declined 5.1% from its 52-week high of $236.13, achieved on Aug. 5. Shares of AMT have gained 17.4% over the past three months, significantly outperforming the broader Nasdaq Composite’s ($NASX) 5.8% return over the same time frame.
Nevertheless, longer term, AMT stock is up 3.8% on a YTD basis, lagging behind NASX’s 18% gains. Moreover, shares of American Tower have gained 23.5% over the past 52 weeks, compared to NASX’s 27% returns in the same time frame.
AMT has been trading above its 200-day and 50-day moving averages since late June, indicating a bullish price trend.
AMT’s underperformance over the past year is primarily due to weaker leasing activity in the U.S., churn from Sprint, and higher interest rates impacting its valuation. However, the stock rose 3.8% following its better-than-expected Q2 earnings release on Jul. 30, driven by strong demand for its portfolio of communications assets. The company also raised its full-year FFO outlook, further boosting investor confidence.
However, its rival, Crown Castle Inc. (CCI), has gained 11.4% over the past 52 weeks and has declined 2.8% on a YTD basis, lagging behind AMT over both time frames.
Despite AMT’s underperformance over the past year, analysts are optimistic about its prospects. The stock has a consensus rating of “Strong Buy” from the 20 analysts covering it, and the mean price target of $234.58 suggests a premium of only 4.7% to current levels.
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