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Crown Castle (CCI) Beats Q2 FFO Estimates, Raises '21 Guidance

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Crown Castle International Corp.’s (CCI - Free Report) second-quarter 2021 adjusted funds from operations (AFFO) per share of $1.71 surpassed the Zacks Consensus Estimate of $1.66. Moreover, the figure came in 17.9% higher than the year ago quarter’s $1.45.

Net revenues of $1.58 billion improved 9.9% year over year in the reported quarter. Further, the reported figure beat the Zacks Consensus Estimate of $1.56 billion.

Growth in site-rental revenues aided the top-line performance. The company also raised the outlook for 2021, backed by contribution from additional straight-lined revenues and an appreciation in the expected services contribution to be generated from higher towers activity than previously estimated.

Per management, "Capitalizing on the momentum created by a robust 5G leasing environment, we were able to deliver another solid quarter in the second quarter and increase our full year 2021 Outlook for AFFO per share growth to 12%".

Quarter in Detail

Site-rental revenues came in at $1.4 billion, up 8% year over year. The organic contribution of $70 million to site rental revenues reflects 5.3% year-over-year growth. Further, services and other revenues rose 30.6% year over year to $158 million.

Quarterly operating expenses flared up 2% year over year to $1.08 billion. The operating income climbed 31.9% year over year to $505 million. Quarterly adjusted EBITDA of $958 million marked a 15.3% year-over-year rise.

The company reported a capital expenditure of $308 million for the second quarter. This included $289 million of discretionary capital expenditure and $19 million of sustaining capital expenditure.

Balance Sheet

Crown Castle exited second-quarter 2021 with cash and cash equivalents of $339 million, up from the $232 million reported at the end of Dec 31, 2020.

Also, debt and other long-term obligations aggregated $20 billion, up from the $19.1 billion witnessed at the end of 2020.

Guidance

The company has raised its outlook for 2021. The AFFO per share is anticipated to be $6.78-$6.89. The Zacks Consensus Estimate for the same is pegged at $6.81. Management estimates site-rental revenues of $5,677-$5,722 million. Adjusted EBITDA is projected at $3,764-$3,809 million.

Crown Castle currently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

We now look forward to the earnings releases of other REITs like Digital Realty Trust, Inc. (DLR - Free Report) , Cousins Properties (CUZ - Free Report) and CubeSmart (CUBE - Free Report) , all of which are slated to report quarterly numbers on Jul 29.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.