UPDATE: BAML Raising Price Target On American Tower Corp.

Bank of America Merrill Lynch is raising its price target on shares of American Tower Corp.

to $65, and it has a Buy rating on shares as the company transforms into a REIT. In a note to clients, Bank of America Merrill Lynch writes, "REITs have a long history of valuation based on unique sector metrics. Applying REIT sector valuation methodology, we estimate AMT is currently trading at a '12 AFFO multiple of 18x with 25% growth in AFFO/share. This compares to a 19x multiple with 12% growth for the REIT universe as a whole and a 21x multiple and 13% growth for the S&P 500 REITs. We have raised our price objective to $65 from $60 to reflect a 21x AFFO multiple on the company's qualified REIT segment, which is consistent with the current average for the S&P 500 REITs and a 19x FCF multiple on its non-REIT subsidiary businesses. We have also adjusted our model modestly to reflect recent financial disclosures breaking out American Tower's US and int'l businesses and modeling them separately." Shares of AMT lost $1.35 yesterday to close at $54.13, a loss of 2.35%.