SBAC - SBA Communications: Too Expensive For What It Delivers
2024-07-08 14:33:51 ET
Summary
- SBA Communications is a leading owner and operator of wireless communications infrastructure, with operations in the U.S. and internationally.
- Headwinds from exposure to weakening currencies, high interest rates and leverage have been impacting the company.
- Despite that, SBA Communications still trades at a premium relative to peers. I question whether that valuation makes sense.
Summary
High interest rates, high leverage, and a weakening Brazilian Real are headwinds that are punishing SBA Communications (SBAC). I do a deep dive into the company to understand how it works and conclude that its valuation doesn't seem to be reflecting the challenges it faces.
Company Overview
SBA Communications is a leading independent owner and operator of wireless communications infrastructure such as tower structures, rooftops, and antennas, commonly referred to simply as "towers" or "sites," which they have been developing since 1989 and owning since 1997. Their main operations are in the U.S., but they also own and operate assets in South America, Central America, Canada, South Africa, the Philippines, and Tanzania. As of December 31, 2023, it had 1,787 employees, 644 of whom are based outside of the U.S....
SBA Communications: Too Expensive For What It Delivers