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Investing.com - Mizuho (NYSE:MFG) has raised its price target on American Tower (NYSE:AMT) to $217.00 from $204.00 while maintaining an Outperform rating on the telecommunications infrastructure company. The new target aligns with the broader analyst consensus, as InvestingPro data shows analyst targets ranging from $217 to $265, with the stock currently trading at $222.83.
The firm increased its Adjusted Funds From Operations (AFFO) estimates to $10.53 for 2025 and $11.43 for 2026, up from previous estimates of $10.47 and $11.27, respectively. Mizuho attributed the upward revision to a lower foreign exchange impact than anticipated and stronger services revenue. According to InvestingPro, American Tower has maintained dividend payments for 15 consecutive years, with a current yield of 3.03%. Five analysts have recently revised their earnings estimates upward for the upcoming period.
Mizuho projects approximately 5% organic tenant billings growth for American Tower’s entire portfolio, with U.S. and Canada operations expected to achieve around 4.3% growth, translating to approximately $182 million in colocation and amendments revenue. The firm anticipates steady acceleration throughout 2025, with performance peaking in the fourth quarter as Sprint churn effects diminish.
For Latin American operations, Mizuho forecasts higher churn rates of approximately 5% in both 2025 and 2026 due to Oi-related factors. The firm also expects American Tower’s SG&A expenses to moderately decrease to approximately $915 million in 2025, representing about $20 million in savings compared to fiscal year 2024.
In the data center segment, Mizuho projects revenue growth of approximately 11% in 2025 and 12% in 2026, citing continued strong pricing power in this division. For services revenue, the firm models approximately $75 million in the second quarter of 2025 and about $250 million for the full year, with a steady increase to $260 million expected in 2026.
In other recent news, American Tower Corporation reported its Q1 2025 earnings, surpassing revenue expectations with actual figures of $2.56 billion against a forecast of $2.54 billion. However, the company’s earnings per share (EPS) came in at $1.04, falling short of the anticipated $1.6. Despite the EPS miss, the company saw positive investor sentiment, driven by robust revenue growth and strategic initiatives. In another development, Moody’s Ratings affirmed American Tower’s Baa3 senior unsecured rating while upgrading the company’s outlook to positive from stable, citing improved earnings stability and strategic shifts towards developed markets. BofA Securities initiated coverage on American Tower with a Buy rating and a price target of $255, highlighting the company’s strong adjusted funds from operations (AFFO) per share growth and diversified international presence. Scotiabank (TSX:BNS) also raised its price target for American Tower to $248, maintaining an Outperform rating due to the company’s strong revenue and AFFO growth. These recent developments underscore American Tower’s strategic positioning and financial health, with analysts expressing confidence in the company’s growth prospects.
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