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American Tower (AMT) Q4 AFFO Beats, Revenues Miss Estimates
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American Tower Corporation (AMT - Free Report) reported fourth-quarter 2019 adjusted funds from operations (AFFO) per share of $1.95, beating the Zacks Consensus Estimate of $1.90. However, the reported figure declined 1%, year on year.
The company generated total revenues of $1.92 billion, which narrowly missed the Zacks Consensus Estimate of $1.93 billion. The figure also fell 9.8% year over year.
The company witnessed decent organic tenant billing growth. However, results were adversely impacted by Indian carrier consolidation-driven churn and non-recurrence of the Tata settlement, leading to an overall reduction in Indian contracted tenant revenues.
For full-year 2019, the company reported AFFO per share of $7.73, indicating an increase of 7.4% from the prior year. Total revenues inched up 1.9% year on year to $7.58 billion.
Quarter in Detail
Adjusted EBITDA in the reported quarter was $1,217 million, down 14.6% from the prior-year quarter. Adjusted EBITDA margin was 63.3% in the final quarter of 2019. Operating income was $661.3 million compared with the $388.9 million reported in the year-ago quarter.
During the fourth quarter, the company spent around $2.6 billion, including assumption of existing debt, to acquire 8,218 communications sites. This comprised roughly 5,800 sites in Africa through acquisition of Eaton Towers Holdings Limited, and 2,400 sites in Chile and Peru from Entel PCS Telecomunicaciones S.A. and Entel Peru S.A.
Cash Flow and Liquidity
In the fourth quarter of 2019, American Tower generated $994 million of cash from operating activities, down 21.3% year over year. Free cash flow during this period was $719 million, down 24.5% year over year.
At the end of the December-end quarter, the company had $4.4 billion of total liquidity. This comprised $1.5 billion in cash and cash equivalents, and availability of $2.9 billion under its revolving credit facilities (net of any outstanding letters of credit).
Property Segment
Quarterly revenues grossed $1,908 million, down 9.3% year over year. Operating profit was $1,251 million and operating profit margin was 66% during fourth-quarter 2019.
In the Property segment, revenues from the United States totaled $1,099 million, up 12.6% year over year. However, total international revenues amounted to $809 million, down 28.2% year over year.
Within this, revenues from Asia totaled $295 million, slumping 53.7% year over year. Africa revenues grossed $150 million, up 5.5% year over year, while Europe revenues of $34 million slipped 8.3% from the year-ago period. Latin America revenues totaled $330 million, improving 6.1% year over year.
Services Segment
Quarterly revenues totaled $15 million, down 46.5% year over year. Operating profit was $6 million and operating profit margin was 36% during the October-December period.
Outlook
For 2020, American Tower anticipates property revenues of $7,975-$8,125 million, reflecting an improvement of 7.8% at the mid-point. Adjusted EBITDA is projected at $5,085-$5,185 million, indicating a mid-point increase of 8.2%. Consolidated AFFO is estimated in the $3,740-$3,840 million band, reflecting a mid-point expansion of 7.6%.
Prologis, Inc. (PLD - Free Report) currently carries a Zacks Rank of 2. The company’s FFO per share estimate for 2020 has been revised 2.5% upward to $3.72 in a month’s time. The stock has rallied 4% in three months’ time.
Public Storage’s (PSA - Free Report) Zacks Consensus Estimate for the current-year FFO per share remained unchanged at $10.99 over the past month. Shares of this Zacks #2 Ranked company have gained 6.8% over the past three months.
Boston Properties, Inc. (BXP - Free Report) also carries a Zacks Rank of 2, currently. The company’s ongoing-year FFO per share estimate moved marginally north to $7.59 in a month’s time. The stock has rallied 4.2% in the past three months.
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.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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American Tower (AMT) Q4 AFFO Beats, Revenues Miss Estimates
American Tower Corporation (AMT - Free Report) reported fourth-quarter 2019 adjusted funds from operations (AFFO) per share of $1.95, beating the Zacks Consensus Estimate of $1.90. However, the reported figure declined 1%, year on year.
The company generated total revenues of $1.92 billion, which narrowly missed the Zacks Consensus Estimate of $1.93 billion. The figure also fell 9.8% year over year.
The company witnessed decent organic tenant billing growth. However, results were adversely impacted by Indian carrier consolidation-driven churn and non-recurrence of the Tata settlement, leading to an overall reduction in Indian contracted tenant revenues.
For full-year 2019, the company reported AFFO per share of $7.73, indicating an increase of 7.4% from the prior year. Total revenues inched up 1.9% year on year to $7.58 billion.
Quarter in Detail
Adjusted EBITDA in the reported quarter was $1,217 million, down 14.6% from the prior-year quarter. Adjusted EBITDA margin was 63.3% in the final quarter of 2019. Operating income was $661.3 million compared with the $388.9 million reported in the year-ago quarter.
During the fourth quarter, the company spent around $2.6 billion, including assumption of existing debt, to acquire 8,218 communications sites. This comprised roughly 5,800 sites in Africa through acquisition of Eaton Towers Holdings Limited, and 2,400 sites in Chile and Peru from Entel PCS Telecomunicaciones S.A. and Entel Peru S.A.
Cash Flow and Liquidity
In the fourth quarter of 2019, American Tower generated $994 million of cash from operating activities, down 21.3% year over year. Free cash flow during this period was $719 million, down 24.5% year over year.
At the end of the December-end quarter, the company had $4.4 billion of total liquidity. This comprised $1.5 billion in cash and cash equivalents, and availability of $2.9 billion under its revolving credit facilities (net of any outstanding letters of credit).
Property Segment
Quarterly revenues grossed $1,908 million, down 9.3% year over year. Operating profit was $1,251 million and operating profit margin was 66% during fourth-quarter 2019.
In the Property segment, revenues from the United States totaled $1,099 million, up 12.6% year over year. However, total international revenues amounted to $809 million, down 28.2% year over year.
Within this, revenues from Asia totaled $295 million, slumping 53.7% year over year. Africa revenues grossed $150 million, up 5.5% year over year, while Europe revenues of $34 million slipped 8.3% from the year-ago period. Latin America revenues totaled $330 million, improving 6.1% year over year.
Services Segment
Quarterly revenues totaled $15 million, down 46.5% year over year. Operating profit was $6 million and operating profit margin was 36% during the October-December period.
Outlook
For 2020, American Tower anticipates property revenues of $7,975-$8,125 million, reflecting an improvement of 7.8% at the mid-point. Adjusted EBITDA is projected at $5,085-$5,185 million, indicating a mid-point increase of 8.2%. Consolidated AFFO is estimated in the $3,740-$3,840 million band, reflecting a mid-point expansion of 7.6%.
Currently, American Tower carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
American Tower Corporation (REIT) Price, Consensus and EPS Surprise
American Tower Corporation (REIT) price-consensus-eps-surprise-chart | American Tower Corporation (REIT) Quote
Other Stocks to Consider
Prologis, Inc. (PLD - Free Report) currently carries a Zacks Rank of 2. The company’s FFO per share estimate for 2020 has been revised 2.5% upward to $3.72 in a month’s time. The stock has rallied 4% in three months’ time.
Public Storage’s (PSA - Free Report) Zacks Consensus Estimate for the current-year FFO per share remained unchanged at $10.99 over the past month. Shares of this Zacks #2 Ranked company have gained 6.8% over the past three months.
Boston Properties, Inc. (BXP - Free Report) also carries a Zacks Rank of 2, currently. The company’s ongoing-year FFO per share estimate moved marginally north to $7.59 in a month’s time. The stock has rallied 4.2% in the past three months.
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.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>