While noting that tower stocks had rallied 9 percent over the past month and 15 percent year-to-date, Citi’s Michael Rollins said in a report that this was the right time to focus on buying the cheaper assets.
Analyst Michael Rollins expects domestic tower site leasing growth to continue to be in the 4-7 percent range over the next 12-months, “as carriers wait for activity to improve from AT&T, an eventual FirstNet deployment, & deployments of other spectrum bands.”
Crown Castle
Rollins downgraded the rating on Crown Castle International Corp CCI from Buy to Neutral, while raising the price target from $94 to $109. The stock has gained almost 26 percent y/y, while the dividend yield has declined to 3.5 percent, falling significantly below the average for the meg-cap telcos of 4.3 percent.
Recommended To Buy
The analyst maintained Buy ratings on American Tower Corp AMT and SBA Communications Corporation SBAC. He raised the price target for American Tower from $121 to $134 and that for SBA Communications from $112 to $132.
The Citi report stated that both companies had “cheaper fundamental valuation metrics, while reinvesting a greater proportion of cash flow into their operations and/or shares.” Their valuations were at a discount of 16 percent, while they faced prospects for improved tower gross profit growth.
Did you like this article? Could it have been improved? Please email feedback@benzinga.com to let us know!
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
---|
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.