American Tower Corporation. ( AMT - Analyst Report ) is set to unveil its third-quarter 2012 results on Wednesday, October 31, before the opening bell. The current Zacks Consensus Estimate for the third quarter is pegged at 38 cents, remaining flat as compared to the year-ago quarter.

With respect to earnings surprise, Crown Castle has outperformed the Zacks Consensus Estimate in three of the last four quarters with an average beat of 0.79%.

Second-Quarter Performance

On August 1, 2012, AMT declared its financial results for the second quarter of 2012 beating the Zacks Consensus Estimates. Quarterly GAAP net income was approximately $48.2 million or 12 cents per share compared with a net income of $115.2 million or 29 cents per share in the year-ago quarter. The company’s second-quarter 2012 earnings per share of 47 cents were significantly above the Zacks Consensus Estimate of 41 cents.

Net revenue in the reported quarter was $697.7 million, up 16.8% year over year, almost in line with the Zacks Consensus Estimate of $698 million.

Gross margin in the reported quarter was 75.3% compared with 74.7% in the year-ago quarter. Operating income was $270.5 million, up 19.8% year over year.

Agreement of Estimate Revisions

In the last 30 days, out of the 17 estimates, there were no revisions in either direction for the third quarter. However, for the fourth quarter of 2012, out of the 16 estimates, two upward revisions were witnessed, while none moved downward over the same time frame.

For 2012, in the last 30 days, out of the 17 estimates, two estimates were revised upward while one moved in the opposite direction. For 2013, out of the 17 estimates, three estimates moved north, while none moved south over the same period.

Magnitude of Estimate Revisions

Over the last 30 days, the current Zacks Consensus Estimate has remained unchanged for the third and fourth quarter of 2012. However, the Zacks Consensus Estimate has deteriorated by 2 cents for 2012 over the last 30 days while the estimate for 2013 has improved by 5 cents over the same time frame.

Our Take

AmericanToweris expected to benefit from the surge in wireless voice, broadband, data and video networks, which require more tower space. Next-generation 4G LTE networks coupled with increased usage of smartphones and tablets will also create impressive demand for tower leasing. Rapid expansion in emerging markets like Brazil and India will provide long-term sustainable business opportunities for the company.

AmericanTowerhas a huge debt, which may hinder the company’s effort to access the debt market at favorable rates in order to borrow and refinance its expansion plans. Additionally, the recent acquisition of 7200 T-Mobile towers has made arch rival Crown Castle International ( CCI - Analyst Report ) , the largest tower operator in the U.S. and is expected to provide stiff competition going forward.

We maintain our long-term Neutral recommendation on American Tower Corporation. However, the company has a Zacks #2 Rank, implying a short-term Buy rating.