American Tower Corp. (AMT) is a leading independent owner and operator of telecommunications real estate with a global portfolio of more than 181,000 sites across the U.S., Europe, South America, Central America, and Africa.
Growing wireless penetration, increased mobile data usage, and spectrum auctions have contributed to a 14.9% compound annual growth rate in adjusted EBITDA and a 15.2% CAGR in consolidated adjusted fund flow from operations (AFFO) between 2009 and 2019.
The rollout of 5G technology around the world and the $3.5 billion acquisition of InSite Wireless Group could drive further growth for the company.
Strong Earnings Growth
Commercial real estate investment trusts (REITs) were hard hit at the beginning of the COVID-19 pandemic, but strong balance sheets, ample liquidity, and reopening of the economy during the summer stabilized the situation. That said, some commercial REITs operate in sectors that performed better than others, such as American Tower’s focus on telecom towers.
American Tower reported third quarter revenue that rose 3.1% to $2.01 billion, beating consensus estimates by $40 million, and FFO of $2.23 per share, beating consensus estimates by $0.22 per share. Adjusted EBITDA also came in higher than expectations at $1.3 billion compared to the $1.24 billion that analysts were expecting to see.
The strong financial results led the company to increase its dividend by 6.1% to $1.21 per share, which represents a forward yield of 2.14%.
The dividend is payable on February 2, 2021 to shareholders on record as of December 28, 2020.
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