American Tower Corporation Faces Challenges Amid Mixed Earnings Report
Despite solid fundamentals, American Tower’s stock struggles to keep pace with the broader market.
With a market cap of $88.2 billion, American Tower Corporation (AMT) stands as a prominent global real estate investment trust (REIT) focused on wireless and broadcast communications infrastructure. The company, based in Boston, Massachusetts, owns and operates thousands of communications sites domestically and internationally.
Over the past 52 weeks, American Tower shares have struggled, dropping 2.4% compared to the S&P 500 Index ($SPX), which saw a substantial 20.7% increase. However, the year 2025 has shown a slight uptick for AMT, which is up 3.5%, while SPX has gained 3.1% year-to-date.
Looking more closely, AMT has also fallen behind the Real Estate Select Sector SPDR Fund’s (XLRE) impressive 9.4% gains during the same period.
The challenges for AMT were evident after its Q3 earnings report on October 29, when shares dropped 4.2% as the results fell short of expectations. Total revenue reached $2.52 billion, missing the consensus estimate of $2.76 billion and showing no growth from the previous year. Nevertheless, funds from operations (FFO) rose 2.3% year-over-year to $2.64 per share, beating the expected $2.54 per share.
In terms of revenue from properties, AMT experienced a 1% decline, totaling $2.47 billion. The company reported a drastic decrease in net income, down 235.2%, highlighting significant difficulties during the quarter. Moreover, adjusted EBITDA slightly dipped to $1.7 billion, indicating ongoing challenges in achieving operational growth.
Upcoming earnings results for fiscal Q4 are set for release on Tuesday, February 25, before the market opens. Analysts are projecting FFO growth of 2.7% year-over-year for fiscal 2024, expected to end in December, with estimates placing it at $10.14 per share. AMT has shown a consistent record of meeting consensus estimates in the previous four quarters.
Currently, AMT stock carries a consensus “Moderate Buy” rating. From the 22 analysts monitoring the stock, 15 suggest a “Strong Buy,” one recommends a “Moderate Buy,” and six indicate a “Hold” rating.
This outlook is more optimistic than two months earlier, when only 14 analysts had an overall “Strong Buy” rating.
Ari Klein from BMO Capital maintained a “Buy” rating for American Tower on February 4, setting a price target of $210, suggesting a potential upside of 10.6% from current levels.
AMT’s average price target is $225.63, indicating an anticipated gain of 18.8% based on current prices. The highest target from analysts reaches $255, representing a potential increase of 34.3%.
On the date of publication, Rashmi Kumari did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information provided is for informational purposes only. For further details, please refer to the Barchart Disclosure Policy.
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
