As the quarterly reports come into view, market analyst Colby Synesael with Cowen weighed in on his comparative views of the “Big Three” towercos. With CCI, he expects it to provide 2021 guidance including ~6 percent organic growth and AFFO/share in-line with the Street. Regarding AMT, Synesael believes it could provide multi-year U.S. organic growth color that, while negative, would ultimately allow the stock to begin working again.
“We have lowered our 2021 U.S. organic growth for AMT to 3.8 percent (from 5.6 percent) and for SBAC to 4.9 percent (from 5.4 percent),” Synesael said.
Since last reporting, he said AMT is down 10.6 percent, CCI is down 4.1 percent, and SBAC is up 1.1 percent vs. the SPX up 7.8 percent the past 75 days. The moves, according to Synesael, largely reflect both the defensive nature of the space which typically results in underperformance during more bullish periods (and vice versa during more bearish periods).
“The same defensive trends can be seen since September 2 when the market last peaked and took on a more bearish view with AMT down 2.3 percent, CCI up 2.9 percent and SBAC up 0.7 percent vs. the SPX down 0.4 percent,” he said, “although we’d note AMT’s relative underperformance to the group has been largely a result of the TMUS MLA they announced on September 15 (LINK).”
Since then, Cowen analysts have noted that AMT is down 4.5 percent, CCI is up 4.1 percent and SBAC is down 0.3 percent vs. the SPX up 3.8 percent
“To that point, while the group is up nicely YTD including AMT +5.5 percent, CCI +17.3 percent,” Synesael said, “and SBAC +28.1 percent vs. the SPX up 8.7 percent, the space has arguably underperformed fundamentally what were more bullish expectations back in February when the U.S. government approved of the T-Mobile/Sprint deal. In retrospect initial expectations for U.S. organic growth in 2H20 were too aggressive and increasingly so are Street assumptions for U.S. organic growth in 2021+.”
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