AMT - American Tower: Overleveraged Overgrown And Overvalued As Data Demand Slows

2024-06-07 16:44:52 ET

Summary

• American Tower has declined by around 34% since my bearish outlook analysis was published in 2021, while the S&P 500 has risen by 20%.
• The rise in interest rates has put negative pressure on all REITs, including AMT, which is currently trading towards the lower end of my previous fair value range.
• AMT's growth potential in Asia, Latin America, and Africa may be limited due to rising economic, social, and political issues, potentially resulting in more impairment losses.
• American Tower's high leverage may be an issue due to its precarious credit rating and significant debt maturities over the next five years.
• My outlook on AMT remains bearish. I believe the company will most likely be unable to continue increasing its dividend.

In 2021, I published a long-term bearish outlook analysis regarding the REIT American Tower ( AMT ) in " American Tower: Global Cellular Data Usage May Already Be Peaking ." The REIT traded at ~$297 then and is now ~34% lower at $195, while the S&P 500 is up by around 20%. Though I attribute this to luck, the article happened to be published within a few days of its all-time high....

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