Crown Castle a Buy Up to $30

We maintain our Buy recommendation with a reduced valuation target for Crown Castle International (CCI - Analyst Report), a leading operator of wireless communications towers in the U.S.A and Australia, as the company prepares to announce 4th quarter 2008 financial results.

Crown Castle performed well with respect to several parameters, including site rental revenue, gross margin, adjusted EBITDA, and recurring cash flow. Financial results are expected to be driven by substantial demand for more tower space to facilitate high-speed 3G mobile technologies.

On the other hand, the level of outstanding debt remains a concern, and we believe the recent stock valuation weakness may be attributed to the leveraged balance sheet with higher debt-servicing costs. Our long-term view regarding the wireless tower industry remains positive and our assessment of Crown Castle's increasing cash flow enables the company to withstand current credit market weakness.

Read the full analyst report on CCI