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Crown Castle Inc. (CCI - Free Report) reported fourth-quarter 2022 adjusted funds from operations (AFFO) per share of $1.85, beating the Zacks Consensus Estimate of $1.83.
The net revenues of $1.76 billion, too, exceeded the Zacks Consensus Estimate of $1.75 billion. Our estimate for the same was pegged at $1.75 billion.
Reported AFFO per share compared favorably with the year-ago period’s $1.77. Net revenues climbed 6.6% from the prior-year quarter’s $1.65 billion.
The rise in site-rental revenues amid elevated tower space demand aided CCI’s year-over-year top-line growth. It maintained its outlook for 2023.
In 2022, Crown Castle reported AFFO per share of $7.38, beating the Zacks Consensus Estimate of $7.36. Moreover, the figure increased 6.2% from the prior year’s $6.95. Net revenues of $6.98 billion improved 10.2% from the prior year’s $6.34 billion. Moreover, the reported figure beat the Zacks Consensus Estimate of $6.97 billion.
Per Jay Brown, chief executive officer of the company, “We generated significant growth in 2022, highlighted by nearly 6.5% organic revenue growth in our Towers segment and more than 9% dividend per share growth. Our ability to deliver strong bottom-line growth in 2022 while navigating a challenging environment with increasing interest rates reflects solid operational performance by our team and the deliberate actions we have taken over the years to reduce the risk profile of our strategy.”
Quarter in Detail
During the fourth quarter, CCI’s site-rental revenues came in at $1.58 billion, up 7.1% year over year. The organic contribution of $57 million to the site rental revenues reflected 4.3% growth. Our estimate for site-rental revenues was pegged at $1.57 billion. Furthermore, services and other revenues climbed 3.3% to $186 million. We estimated the same to be $185.5 million.
CCI’s quarterly operating expenses increased 1.9% year over year to $1.15 billion. The operating income climbed 16.8% to $610 million. The quarterly adjusted EBITDA of $1.1 billion marked a 10.8% year-over-year increase primarily due to growth in site rental revenues and higher services contribution.
Crown Castle reported capital expenditures of $389 million in the quarter. This comprised discretionary capital expenditures of $359 million and sustaining capital expenditures of $30 million. Discretionary capital expenditures primarily attributable to Fiber were around $307 million, and that to Towers was roughly $45 million.
Balance Sheet
Crown Castle exited fourth-quarter 2022 with cash and cash equivalents of $156 million, down from $174 million reported as of Sep 30, 2022.
Moreover, debt and other long-term obligations aggregated $20.9 billion, up from $20.7 billion witnessed as of Sep 30, 2022.
2023 Guidance
Crown Castle maintained its guidance for 2023.
It expects AFFO per share in the range of $7.58-$7.68. The Zacks Consensus Estimate for the same is pegged at $7.63, which lies within the guided range.
Site rental revenues are expected to lie between $6.488 billion and $6.533 billion while the adjusted EBITDA is projected at $4.449 billion.
We now look forward to the earnings releases of other REITs like Alexandria Real Estate Equities, Inc. (ARE - Free Report) and Equity Residential (EQR - Free Report) , slated to report on Jan 30 and Feb 9, respectively. Equinix (EQIX - Free Report) is scheduled on Feb 15.
The Zacks Consensus Estimate for Alexandria’s fourth-quarter 2022 FFO per share is pegged at $2.13, implying a year-over-year increase of 8.1%. ARE currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Equity Residential’s fourth-quarter 2022 FFO per share stands at 94 cents, indicating a year-over-year increase of 14.6%. EQR currently has a Zacks Rank #3.
The Zacks Consensus Estimate for Equinix’s fourth-quarter 2022 FFO per share is pegged at $6.84, suggesting a year-over-year increase of 9.9%. EQIX currently carries a Zacks Rank #3.
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.
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Crown Castle (CCI) Q4 FFO & Revenues Beat on Solid Demand
Crown Castle Inc. (CCI - Free Report) reported fourth-quarter 2022 adjusted funds from operations (AFFO) per share of $1.85, beating the Zacks Consensus Estimate of $1.83.
The net revenues of $1.76 billion, too, exceeded the Zacks Consensus Estimate of $1.75 billion. Our estimate for the same was pegged at $1.75 billion.
Reported AFFO per share compared favorably with the year-ago period’s $1.77. Net revenues climbed 6.6% from the prior-year quarter’s $1.65 billion.
The rise in site-rental revenues amid elevated tower space demand aided CCI’s year-over-year top-line growth. It maintained its outlook for 2023.
In 2022, Crown Castle reported AFFO per share of $7.38, beating the Zacks Consensus Estimate of $7.36. Moreover, the figure increased 6.2% from the prior year’s $6.95. Net revenues of $6.98 billion improved 10.2% from the prior year’s $6.34 billion. Moreover, the reported figure beat the Zacks Consensus Estimate of $6.97 billion.
Per Jay Brown, chief executive officer of the company, “We generated significant growth in 2022, highlighted by nearly 6.5% organic revenue growth in our Towers segment and more than 9% dividend per share growth. Our ability to deliver strong bottom-line growth in 2022 while navigating a challenging environment with increasing interest rates reflects solid operational performance by our team and the deliberate actions we have taken over the years to reduce the risk profile of our strategy.”
Quarter in Detail
During the fourth quarter, CCI’s site-rental revenues came in at $1.58 billion, up 7.1% year over year. The organic contribution of $57 million to the site rental revenues reflected 4.3% growth. Our estimate for site-rental revenues was pegged at $1.57 billion. Furthermore, services and other revenues climbed 3.3% to $186 million. We estimated the same to be $185.5 million.
CCI’s quarterly operating expenses increased 1.9% year over year to $1.15 billion. The operating income climbed 16.8% to $610 million. The quarterly adjusted EBITDA of $1.1 billion marked a 10.8% year-over-year increase primarily due to growth in site rental revenues and higher services contribution.
Crown Castle reported capital expenditures of $389 million in the quarter. This comprised discretionary capital expenditures of $359 million and sustaining capital expenditures of $30 million. Discretionary capital expenditures primarily attributable to Fiber were around $307 million, and that to Towers was roughly $45 million.
Balance Sheet
Crown Castle exited fourth-quarter 2022 with cash and cash equivalents of $156 million, down from $174 million reported as of Sep 30, 2022.
Moreover, debt and other long-term obligations aggregated $20.9 billion, up from $20.7 billion witnessed as of Sep 30, 2022.
2023 Guidance
Crown Castle maintained its guidance for 2023.
It expects AFFO per share in the range of $7.58-$7.68. The Zacks Consensus Estimate for the same is pegged at $7.63, which lies within the guided range.
Site rental revenues are expected to lie between $6.488 billion and $6.533 billion while the adjusted EBITDA is projected at $4.449 billion.
Crown Castle currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Crown Castle Inc. Price, Consensus and EPS Surprise
Crown Castle Inc. price-consensus-eps-surprise-chart | Crown Castle Inc. Quote
Upcoming Earnings Releases
We now look forward to the earnings releases of other REITs like Alexandria Real Estate Equities, Inc. (ARE - Free Report) and Equity Residential (EQR - Free Report) , slated to report on Jan 30 and Feb 9, respectively. Equinix (EQIX - Free Report) is scheduled on Feb 15.
The Zacks Consensus Estimate for Alexandria’s fourth-quarter 2022 FFO per share is pegged at $2.13, implying a year-over-year increase of 8.1%. ARE currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Equity Residential’s fourth-quarter 2022 FFO per share stands at 94 cents, indicating a year-over-year increase of 14.6%. EQR currently has a Zacks Rank #3.
The Zacks Consensus Estimate for Equinix’s fourth-quarter 2022 FFO per share is pegged at $6.84, suggesting a year-over-year increase of 9.9%. EQIX currently carries a Zacks Rank #3.
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.