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Shares of American Tower Corporation (AMT - Free Report) are up 1.28% in today’s pre-market trading session in response to stellar third-quarter results.
Adjusted funds from operations (AFFO) per share, attributable to AMT common stockholders, of $2.58 beat the Zacks Consensus Estimate of $2.35 and climbed 9.3% year over year.
Results reflect better-than-anticipated revenues, aided by revenue growth across its Property segment. American Tower recorded healthy year-over-year organic tenant billings growth of 6.3% and total tenant billings growth of 7.3%. It also raised its outlook for 2023.
The company has clocked in total revenues of $2.82 billion, outpacing the Zacks Consensus Estimate of $2.76 billion. On a year-over-year basis, the figure increased 5.5% from the prior-year quarter.
Per Tom Bartlett, CEO, American Tower, “We had a strong quarter, as our global portfolio of communications assets continued to demonstrate resiliency in an increasingly challenging macroeconomic environment. As a result of our strong results, and a high degree of visibility through the balance of the year, we are pleased to again raise our full year outlook for property revenue, Adjusted EBITDA and Attributable AFFO, and remain encouraged by our positioning as we look forward to 2024.”
Quarter in Detail
Adjusted EBITDA was $1.81 billion, up 10.4% from the prior-year period. The adjusted EBITDA margin was 64.4% in the quarter.
In the reported quarter, AMT shelled out $61 million for the purchase of sites related to a sublease agreement with SBC Communications Inc., a predecessor entity to AT&T Inc., and other communications infrastructure assets.
Property Operations
Revenues were $2.79 billion, up almost 7% on a year-over-year basis. Our estimate for Property revenues was pegged at $2.69 billion. The operating profit was $1.86 billion, and the operating profit margin was 67%.
In the Property segment, revenues from the United States and Canada totaled $1.33 billion, up 5.2% year over year. Total international revenues amounted to $1.26 billion, rising 8.6%. Newly formed Data Centers added $212 million to Property revenues, up 9.3% from $194 million in the prior-year period.
Service Operations
Revenues totaled $26.2 million in the reported quarter, down from $61.6 million in the prior-year quarter. We expected the metric to be $54.9 million. The operating profit was $8 million and the operating profit margin was 29% in the July-September quarter.
Cash Flow & Liquidity
In the third quarter, American Tower generated $1.30 billion of cash from operating activities, rising 39.5% year over year. Free cash flow in the period was $892 million, jumping substantially from a year ago.
As of Sep 30, 2023, the company had $9.7 billion in total liquidity. This comprised $2.1 billion in cash and cash equivalents, and availability of $7.6 billion under its revolving credit facilities (net of any outstanding letters of credit).
Upbeat 2023 Guidance
American Tower anticipates total property revenues of $10,895 -$10,985 million, suggesting a year-over-year improvement of 4.5% at the mid-point. The earlier guided range was $10,790-$10,970 million.
The adjusted EBITDA was revised upward to $7,010-$7,090 million from $6,950-$7,030 million stated earlier. This indicates a mid-point increase of 6.1%.
The AFFO attributable to AMT common stockholders is now projected in the band of $4,540 -$4,600 million, implying 1.2% year-over-year growth at the mid-point. The company’s prior expectations ranged between $4,490 million and $4,570 million.
AFFO per share was revised upward to $9.72-$ 9.85, indicating a marginal rise at the mid-point of 0.3%. The prior projected range was $9.61-$ 9.79. The Zacks Consensus Estimate for the same is pegged at $9.72.
The company maintained its guidance for capital expenditure between $1,650 million and $1,760 million.
Prologis, Inc. (PLD - Free Report) reported third-quarter 2023 core FFO per share of $1.30, beating the Zacks Consensus Estimate of $1.26. The figure, however, declined 24.9% from the year-ago quarter.
The results of this industrial REIT reflected healthy rent growth. However, lower occupancy and higher interest expenses were undermining factors. PLD also raised the midpoint of its 2023 core FFO per share guidance by a cent.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported third-quarter 2023 AFFO per share of $2.26, surpassing the Zacks Consensus Estimate of $2.24. The reported figure climbed 6.1% from the year-ago quarter.
Results reflected year-over-year revenue growth, aided by decent leasing activity and solid rental rate growth. ARE also increased the midpoint of its 2023 AFFO per share outlook by 2 cents.
Equinix Inc.’s (EQIX - Free Report) third-quarter 2023 AFFO per share of $8.19 surpassed the Zacks Consensus Estimate of $7.79. The figure improved nearly 6% from the prior-year quarter.
EQIX’s results reflected steady growth in colocation and inter-connection revenues as enterprises and service providers look to integrate artificial intelligence into their strategies and offerings. During the quarter, Equinix’s total interconnections reached 460,500, rising 1% sequentially and 4% year over year. The company also raised its AFFO per share guidance for 2023.
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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American Tower's (AMT) Q3 AFFO & Revenues Top, '23 View Raised
Shares of American Tower Corporation (AMT - Free Report) are up 1.28% in today’s pre-market trading session in response to stellar third-quarter results.
Adjusted funds from operations (AFFO) per share, attributable to AMT common stockholders, of $2.58 beat the Zacks Consensus Estimate of $2.35 and climbed 9.3% year over year.
Results reflect better-than-anticipated revenues, aided by revenue growth across its Property segment. American Tower recorded healthy year-over-year organic tenant billings growth of 6.3% and total tenant billings growth of 7.3%. It also raised its outlook for 2023.
The company has clocked in total revenues of $2.82 billion, outpacing the Zacks Consensus Estimate of $2.76 billion. On a year-over-year basis, the figure increased 5.5% from the prior-year quarter.
Per Tom Bartlett, CEO, American Tower, “We had a strong quarter, as our global portfolio of communications assets continued to demonstrate resiliency in an increasingly challenging macroeconomic environment. As a result of our strong results, and a high degree of visibility through the balance of the year, we are pleased to again raise our full year outlook for property revenue, Adjusted EBITDA and Attributable AFFO, and remain encouraged by our positioning as we look forward to 2024.”
Quarter in Detail
Adjusted EBITDA was $1.81 billion, up 10.4% from the prior-year period. The adjusted EBITDA margin was 64.4% in the quarter.
In the reported quarter, AMT shelled out $61 million for the purchase of sites related to a sublease agreement with SBC Communications Inc., a predecessor entity to AT&T Inc., and other communications infrastructure assets.
Property Operations
Revenues were $2.79 billion, up almost 7% on a year-over-year basis. Our estimate for Property revenues was pegged at $2.69 billion. The operating profit was $1.86 billion, and the operating profit margin was 67%.
In the Property segment, revenues from the United States and Canada totaled $1.33 billion, up 5.2% year over year. Total international revenues amounted to $1.26 billion, rising 8.6%. Newly formed Data Centers added $212 million to Property revenues, up 9.3% from $194 million in the prior-year period.
Service Operations
Revenues totaled $26.2 million in the reported quarter, down from $61.6 million in the prior-year quarter. We expected the metric to be $54.9 million. The operating profit was $8 million and the operating profit margin was 29% in the July-September quarter.
Cash Flow & Liquidity
In the third quarter, American Tower generated $1.30 billion of cash from operating activities, rising 39.5% year over year. Free cash flow in the period was $892 million, jumping substantially from a year ago.
As of Sep 30, 2023, the company had $9.7 billion in total liquidity. This comprised $2.1 billion in cash and cash equivalents, and availability of $7.6 billion under its revolving credit facilities (net of any outstanding letters of credit).
Upbeat 2023 Guidance
American Tower anticipates total property revenues of $10,895 -$10,985 million, suggesting a year-over-year improvement of 4.5% at the mid-point. The earlier guided range was $10,790-$10,970 million.
The adjusted EBITDA was revised upward to $7,010-$7,090 million from $6,950-$7,030 million stated earlier. This indicates a mid-point increase of 6.1%.
The AFFO attributable to AMT common stockholders is now projected in the band of $4,540 -$4,600 million, implying 1.2% year-over-year growth at the mid-point. The company’s prior expectations ranged between $4,490 million and $4,570 million.
AFFO per share was revised upward to $9.72-$ 9.85, indicating a marginal rise at the mid-point of 0.3%. The prior projected range was $9.61-$ 9.79. The Zacks Consensus Estimate for the same is pegged at $9.72.
The company maintained its guidance for capital expenditure between $1,650 million and $1,760 million.
Currently, AMT carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
American Tower Corporation Price, Consensus and EPS Surprise
American Tower Corporation price-consensus-eps-surprise-chart | American Tower Corporation Quote
Performance of Other REITs
Prologis, Inc. (PLD - Free Report) reported third-quarter 2023 core FFO per share of $1.30, beating the Zacks Consensus Estimate of $1.26. The figure, however, declined 24.9% from the year-ago quarter.
The results of this industrial REIT reflected healthy rent growth. However, lower occupancy and higher interest expenses were undermining factors. PLD also raised the midpoint of its 2023 core FFO per share guidance by a cent.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported third-quarter 2023 AFFO per share of $2.26, surpassing the Zacks Consensus Estimate of $2.24. The reported figure climbed 6.1% from the year-ago quarter.
Results reflected year-over-year revenue growth, aided by decent leasing activity and solid rental rate growth. ARE also increased the midpoint of its 2023 AFFO per share outlook by 2 cents.
Equinix Inc.’s (EQIX - Free Report) third-quarter 2023 AFFO per share of $8.19 surpassed the Zacks Consensus Estimate of $7.79. The figure improved nearly 6% from the prior-year quarter.
EQIX’s results reflected steady growth in colocation and inter-connection revenues as enterprises and service providers look to integrate artificial intelligence into their strategies and offerings. During the quarter, Equinix’s total interconnections reached 460,500, rising 1% sequentially and 4% year over year. The company also raised its AFFO per share guidance for 2023.
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.