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Tuesday, American Tower Corporation (NYSE:AMT), a prominent player in the Specialized REITs industry with a market capitalization of $94.8 billion, received reaffirmation of its Buy rating and a $220.00 price target from Citi, following the company’s release of its fourth-quarter earnings. According to InvestingPro data, analyst targets range from $195 to $250, suggesting potential upside. The telecommunications infrastructure provider reported revenue and EBITDA figures that surpassed expectations, with Adjusted Funds From Operations (AFFOPS) meeting projections. With an impressive EBITDA of nearly $7 billion and a robust gross profit margin of 71%, American Tower experienced a 5% year-over-year organic growth overall, with domestic growth at 4.2% and international growth reaching 6.5%. The company has maintained its commitment to shareholders, having raised its dividend for 14 consecutive years, currently offering a yield of 3.4%.
The company’s performance was bolstered by additional revenue streams that contributed to both domestic and international site leasing revenue. Looking ahead, American Tower’s 2025 outlook remains positive, with an anticipated AFFOPS growth rate of nearly 9% year-over-year. However, this figure is expected to be adjusted to over 4% due to foreign exchange and interest rate headwinds. The guidance for overall organic tenant billings growth stands at 5%, with domestic growth projected to be at least 4.3%, which is slightly below the estimate and consensus of 4.5% and 4.6%, respectively.
American Tower’s data center segment continues to show strong performance, with a forecast of 12% revenue growth in 2025. Citi’s endorsement of the company’s stock remains steadfast, with expectations that the share price will hover around its current levels in the near term. Comments made during the earnings call regarding the domestic leasing environment are also expected to play a role in influencing the stock’s movement. InvestingPro analysis indicates a "GOOD" overall financial health score, though investors should note the stock is trading above its Fair Value. For deeper insights, including 8 additional ProTips and comprehensive valuation metrics, explore the full Pro Research Report available on InvestingPro.
In other recent news, American Tower Corporation reported fourth-quarter financial results that exceeded analyst expectations. The company announced adjusted funds from operations (AFFO) of $2.32 per share, surpassing the previous year’s $2.29 per share and beating consensus estimates. Revenue for the quarter increased by 3.7% year-over-year to $2.55 billion, also exceeding analyst projections of $2.52 billion. For the full year 2024, American Tower generated AFFO of $10.54 per share on revenue of $10.13 billion. Looking forward, the company forecasts 2025 AFFO in the range of $10.31 to $10.50 per share, with expected revenue between $9.92 billion and $10.07 billion. The company highlighted ongoing strong demand for connectivity across its global platform, despite macroeconomic challenges. American Tower stated that strategic steps in portfolio management and disciplined capital allocation have positioned it well to handle market volatility.
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