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What's in Store for American Tower (AMT) in Q4 Earnings?
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American Tower Corporation (AMT - Free Report) is scheduled to release fourth-quarter and full-year 2022 results on Feb 23 before the opening bell. The company’s quarterly results are likely to display year-over-year growth in revenues and funds from operations (FFO) per share.
In the last quarter, American Tower missed adjusted FFO per share estimates by 2.48%. However, over the preceding four quarters, the company topped FFO per share estimates on three occasions and missed the same on the other, the average beat being 1.13%. The graph below depicts this surprise history:
Let’s see how things have shaped up before the earnings release.
Factors to Note
American Tower’s extensive and geographically diversified communication real estate portfolio is expected to have benefited from increased capital spending by wireless carriers due to incremental demand from global 4G and 5G deployment efforts, growing wireless penetration and spectrum auctions. This demand for AMT’s portfolio of communication sites in the fourth quarter of 2022 is likely to have aided its top line.
Also, the demand for American Tower’s highly interconnected data center facilities and critical cloud on-ramps is anticipated to have remained robust during the quarter. Further, the company’s solid balance sheet strength is expected to have aided its investments in existing 4G networks as well as its efforts for 5G deployment during the quarter under discussion.
The Zacks Consensus Estimate for fourth-quarter 2022 revenues is pegged at $2.68 billion, indicating a rise of 9.6% from the year-earlier period.
The Zacks Consensus Estimate for operating revenues from the Property segment is pegged at $2.59 billion, indicating growth from the $2.44 billion reported in the year-ago period.
However, operating revenues from the Service segment are expected to be on the lower side in the to-be-reported quarter. The Zacks Consensus Estimate for the same is pegged at $60.79 million, indicating a decline from the $67.0 million reported in the prior-year quarter.
A hike in interest rates is anticipated to have raised interest expenses and borrowing costs to purchase or develop real estate.
American Tower’s activities in the fourth quarter were not adequate to secure analysts’ confidence. The Zacks Consensus Estimate for quarterly FFO per share has been revised marginally downward to $2.23 over the past month. However, it suggests a year-over-year increase of 2.3%.
For the full-year 2022, American Tower anticipated total property revenues in the range of $10,395-$10,485 million, suggesting a year-over-year improvement of 14.6% at the midpoint. Adjusted EBITDA is projected in the band of $6,580-$6,660 million, indicating a midpoint increase of 10.6% year over year. Consolidated AFFO is expected between $4,595 and $4,675 million, implying a year-over-year midpoint expansion of 6.0%.
Further, AFFO for common stockholders is anticipated in the band of $4,430-$4,510 million, suggesting midpoint growth of 4.5% year over year. AFFO per share is expected in the band of $9.57-$9.74, indicating an increase of 2.3% year over year. Capital expenditure is projected between $1.895 and $1.995 billion.
For the full year, the Zacks Consensus Estimate for the FFO per share is pegged at $9.70. The figure indicates a 0.5% increase year over year on 14.2% year-over-year growth in revenues to $10.68 billion.
Here Is What Our Quantitative Model Predicts:
Our proven model does not conclusively predict a surprise in terms of FFO per share for AMT this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is not the case here.
American Tower currently carries a Zacks Rank of 3 and has an Earnings ESP of -0.60%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks from the broader REIT sector — Extra Space Storage Inc. (EXR - Free Report) and Park Hotels & Resorts Inc. (PK - Free Report) — that you may want to consider as our model shows that these have the right combination of elements to report a surprise this quarter.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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What's in Store for American Tower (AMT) in Q4 Earnings?
American Tower Corporation (AMT - Free Report) is scheduled to release fourth-quarter and full-year 2022 results on Feb 23 before the opening bell. The company’s quarterly results are likely to display year-over-year growth in revenues and funds from operations (FFO) per share.
In the last quarter, American Tower missed adjusted FFO per share estimates by 2.48%. However, over the preceding four quarters, the company topped FFO per share estimates on three occasions and missed the same on the other, the average beat being 1.13%. The graph below depicts this surprise history:
American Tower Corporation Price and EPS Surprise
American Tower Corporation price-eps-surprise | American Tower Corporation Quote
Let’s see how things have shaped up before the earnings release.
Factors to Note
American Tower’s extensive and geographically diversified communication real estate portfolio is expected to have benefited from increased capital spending by wireless carriers due to incremental demand from global 4G and 5G deployment efforts, growing wireless penetration and spectrum auctions. This demand for AMT’s portfolio of communication sites in the fourth quarter of 2022 is likely to have aided its top line.
Also, the demand for American Tower’s highly interconnected data center facilities and critical cloud on-ramps is anticipated to have remained robust during the quarter. Further, the company’s solid balance sheet strength is expected to have aided its investments in existing 4G networks as well as its efforts for 5G deployment during the quarter under discussion.
The Zacks Consensus Estimate for fourth-quarter 2022 revenues is pegged at $2.68 billion, indicating a rise of 9.6% from the year-earlier period.
The Zacks Consensus Estimate for operating revenues from the Property segment is pegged at $2.59 billion, indicating growth from the $2.44 billion reported in the year-ago period.
However, operating revenues from the Service segment are expected to be on the lower side in the to-be-reported quarter. The Zacks Consensus Estimate for the same is pegged at $60.79 million, indicating a decline from the $67.0 million reported in the prior-year quarter.
A hike in interest rates is anticipated to have raised interest expenses and borrowing costs to purchase or develop real estate.
American Tower’s activities in the fourth quarter were not adequate to secure analysts’ confidence. The Zacks Consensus Estimate for quarterly FFO per share has been revised marginally downward to $2.23 over the past month. However, it suggests a year-over-year increase of 2.3%.
For the full-year 2022, American Tower anticipated total property revenues in the range of $10,395-$10,485 million, suggesting a year-over-year improvement of 14.6% at the midpoint. Adjusted EBITDA is projected in the band of $6,580-$6,660 million, indicating a midpoint increase of 10.6% year over year. Consolidated AFFO is expected between $4,595 and $4,675 million, implying a year-over-year midpoint expansion of 6.0%.
Further, AFFO for common stockholders is anticipated in the band of $4,430-$4,510 million, suggesting midpoint growth of 4.5% year over year. AFFO per share is expected in the band of $9.57-$9.74, indicating an increase of 2.3% year over year. Capital expenditure is projected between $1.895 and $1.995 billion.
For the full year, the Zacks Consensus Estimate for the FFO per share is pegged at $9.70. The figure indicates a 0.5% increase year over year on 14.2% year-over-year growth in revenues to $10.68 billion.
Here Is What Our Quantitative Model Predicts:
Our proven model does not conclusively predict a surprise in terms of FFO per share for AMT this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is not the case here.
American Tower currently carries a Zacks Rank of 3 and has an Earnings ESP of -0.60%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some stocks from the broader REIT sector — Extra Space Storage Inc. (EXR - Free Report) and Park Hotels & Resorts Inc. (PK - Free Report) — that you may want to consider as our model shows that these have the right combination of elements to report a surprise this quarter.
Extra Space Storage, slated to report fourth-quarter earnings on Feb 22, currently has an Earnings ESP of +4.01% and carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Park Hotels & Resorts, scheduled to report quarterly numbers on Feb 22, currently has an Earnings ESP of +3.66% and carries a Zacks Rank of 3.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.