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American Tower Corp.’s (AMT - Analyst Report) first-quarter 2013 net earnings per share came in at 38 cents, missing the Zacks Consensus Estimate of 48 cents. On a GAAP basis, net income in the reported quarter was $171.4 million or 43 cents per share compared with $221.3 million or 56 cents per share in the prior-year quarter. Total revenue of $802.7 million grew 15.2% year over year to beat the Zacks Consensus Estimate of $782.0 million.

Adjusted EBITDA in the reported quarter was $524.4 million, representing an annualized growth of 13.4%. Adjusted EBITDA margin was 65% compared with 66% in the prior-year quarter. Gross margin was 74.9% compared with 75.4% in the year-ago quarter.

Selling, general & administrative expenses were $101.2 million compared with $79.6 million in the year-ago quarter. Operating income was $299.7 million, up 9.2% year over year. In the reported quarter, American Tower repurchased 0.2 million shares of its Class A common stock for a total consideration of $12.5 million.

In first quarter of 2013, American Tower generated $394.0 million in cash from operations against $402.0 million in the previous year quarter. Adjusted funds from operations (AFFO) in the reported quarter were $357.8 million, up 9.9% from the year-ago quarter. AFFO per share was 90 cents compared with 82 cents in the prior-year quarter.

At the end of first quarter 2013, American Tower had $454.7 million in cash and marketable securities and around $8,791.5 million in outstanding debt on its balance sheet compared with $374.6 million and $8,693.3 million respectively at the end of 2012. At the end of first quarter 2013, debt-to-capitalization ratio was 0.70 or flat as compared to the end of 2012.

Domestic Rental and Management Segment

Quarterly revenue was $515.7 million, up 5.9% year over year. Gross margin came in at 82.2% compared with 80.9% in the year-ago quarter. Operating margin was 78.0% compared with 77.0% in the year-ago quarter.

International Rental and Management Segment

Quarterly revenue stood at $261.8 million, signifying a 32.9% year over year growth. Gross margin for the segment was 63.4% compared with 66.0% in the year-ago quarter. Operating margin was 52.0% compared with 54.0% in the year-ago quarter.

Network Development Services Segment

Quarterly revenue was $25.3 million, up by an enormous 101.9% year over year. Gross margin was 59.4% compared with 44.1% in the year-ago quarter. Operating margin was 48.0% compared with 41.0% in the year-ago quarter.

Tower Count

At the end of first quarter of 2013, American Tower managed 55,673 communications towers, of which 55,199 were for Wireless network and 474 for Broadcasting. Geographically, the company operates 22,534 wireless towers and 275 broadcast towers in the U.S. along with 33,139 wireless towers and 199 broadcast towers outside the U.S.

Financial Outlook

For 2013, total revenue from the Rental & Management segment is likely to be $3,160 million to $3,210 million. Adjusted EBITDA is anticipated in the band of $2,080 to $2,130 million. AFFO is estimated at around $1,420 -$1,470 million. Net income is estimated around $765 -$840 million. Capital expenditure is expected in the band of $550 -$650 million.

Other Stocks to Consider

American Tower currently has a Zacks Rank #3 (Hold). Other stocks in the wireless tower industry include Crown Castle International Corp. (CCI - Analyst Report), SBA Communication Corp. (SBAC - Snapshot Report) and Equinix Inc. (EQIX - Analyst Report).

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