Florida-based SBA Communications Corporation (SBAC), with a market cap of $23 billion, is a leading independent owner and operator of wireless communications infrastructure. The company is expected to announce its fiscal Q2 earnings results after the market closes on Monday, Jul. 29.
Ahead of this event, analysts expect the wireless tower operator to report adjusted funds from operations (AFFO) of $3.12 per share, down 3.7% from the previous year's $3.24 per share. However, the company has surpassed Wall Street's bottom-line estimates in the last four quarters. In the most recent quarter, the company reported an AFFO of $3.29 per share, surpassing the consensus estimate by 5.5% due to higher-than-expected tower cash flow and successful cost management initiatives, including strategic site acquisitions and new site constructions.
For fiscal 2024, analysts expect SBAC to report an AFFO of $12.51 per share, a decrease of 5.1% from $13.18 per share in fiscal 2023.
Over the past 52 weeks, SBAC has declined 7.4%, underperforming both the S&P 500 Index's ($SPX) 21.6% gain and the S&P 500 Real Estate Sector SPDR's (XLRE) 6.4% increase over the same period.
In February, SBAC’s shares dropped after missing Q4 revenue estimates and lowering its 2024 forecast due to sluggish wireless carrier activity. Moreover, the stock then declined 7.8% post-Q1 earnings on Apr. 29, impacted by a strong US dollar, high churn from market consolidation, and concerns over high interest rates impacting debt costs and revenue. Plus, a slight downgrade in site leasing revenue and total revenues from initial guidance further impacted investor sentiment.
Overall, analysts' consensus view on SBA Communications stock is cautiously optimistic, with a "Moderate Buy" rating. Out of 17 analysts covering the stock, 10 give a "Strong Buy," two have a "Moderate Buy" rating, and five give a "Hold" rating.
The above consensus is slightly less bullish than three months ago, with 11 “Strong Buy” ratings on the stock. The average analyst price target for SBAC is $239.65, suggesting a potential upside of 13.4% from current levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
