Deutsche Bank Reiterates Buy Rating on American Tower (AMT)

Deutsche Bank is out with a research report this morning, where it reiterates its Buy rating on American Tower Corp. AMT; it has a $53.00 price target on the stock. The DB analysts said that the company is well positioned to benefit from the rapid adoption of wireless broadband, which is prompting major carriers to allocate a larger portion of capex budgets to wireless infrastructure. They added that they believe wireless capex will grow by 9 to 10% at a CAGR of 6%, adding that, while there is no perfect correlation between wireless capex and tower leasing, we have found that they trend together as both are a function of wireless spending appetite. As for valuation, the DB analysts said, “Our $53 price target is based 3 equally weighted methods: FCF/share (21x ’11E FCF/share), EV/EBITDA (17x ’11E EBITDA) – both in line with its historical averages – and DCF (8.6% WACC, 2% term). Key risks include delayed network upgrades, credit market volatility, and carrier consolidation.”