American Tower Corp. is a holding company that operates as a real estate investment trust (REIT), which owns, operates, and develops multitenant communications real estate. Its primary business is leasing space on multitenant communications sites to wireless service providers, radio and television broadcast companies, wireless data providers, government agencies and municipalities and tenants in several other industries.
American Tower has a global portfolio of nearly 226 000 communications sites across 25 countries. The company has seen strong gross leasing trends driven by robust demand for communications infrastructure. Between 2018 and 2022, AMT has seen adjusted Funds from Operations (AFFO) grow by a CAGR of ~8% per annum.
Technically, the stock is reflecting price symmetry (see the shadings on the main chart). Certain patterns tend to repeat themselves in the market due to the collective psychology of market participants. As such, given the current symmetrical pattern, there is a possibility that a reversal may occur in roughly the same magnitude and duration.
The start of upside momentum according to the MACD indicator, as well as sideways movement of the On-Balance Volume indicator, supports our bullish stance.
The price is below the 200-day simple moving average (SMA) of ~$188. We implement a counter-trend strategy in anticipation of a near-term correction.
Share Information
| Share Code | AMT US |
|---|---|
| Industry | Equity Real Estate Investment |
| Market Capital (USD) | 83.07 billion |
| One Year Total Return | -11.41% |
| Return Year-to-Date | -13.71% |
| Current Price (USD) | 178.19 |
| 52 Week High (USD) | 235.57 |
| 52 Week Low (USD) | 154.58 |
| Financial Year End | December |
| The stock devalued recently; however, various technical indicators suggest that the stock price will make a break to the upside. |
Consensus expectations
(Bloomberg)
| FY22 | FY23E | FY24E | FY25E | |
|---|---|---|---|---|
| Headline Earnings per Share (USD) | 3.82 | 4.07 | 4.87 | 5.44 |
| Growth (%) | 6.55 | 19.77 | 11.66 | |
| Dividend Per Share (USD) | 5.86 | 6.41 | 6.78 | 7.43 |
| Growth (%) | 9.32 | 5.85 | 9.63 | |
| Forward PE (times) | 43.82 | 36.59 | 32.77 | |
| Forward Dividend Yield (%) | 3.60 | 3.81 | 4.17 | |
| Growth is expected to be in the double digits from FY24 onwards. | ||||
Buy/Sell Rationale
Technical Analysis:
Long-term fundamental view:
| Share Name and position | HST - Stop Loss (Close the Position) |
NKE - Stop Loss (Close the Position) |
MSFT - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 16.26 | 105.18 | 331.32 |
| Current | 15.05 | 97.98 | 338.11 |
| Movement | -7.4% | -6.8% | 2% |
| The stock breached our stop-loss level, and we closed the position. | The stock breached our stop-loss level, and we closed the position. |
The development of a bullish flag pattern remains of interest. The stock is trading above its 200-day simple moving average. Fading downside momentum provides further support.
Our profit target is $365 with a trailing stop-loss at $324.40. Exit the position around 12 January 2024. |
| Share Name and position | KO - Buy (Continue to hold) |
GILD - Buy (Continue to hold) |
|---|---|---|
| Entry | 55.78 | 80.00 |
| Current | 56.49 | 78.54 |
| Movement | 1.3% | -1.8% |
|
The price is currently in the lower range of an inclining linear regression channel pattern. The stock remains below the 200-day SMA. Upside price momentum is supportive.
Our profit target is $61 with a trailing stop-loss of $54.50. Exit the position around 12 January 2024. |
The development of a bullish flag pattern remains attractive. The stock is testing its 200-day SMA, with emerging upside momentum offering some support.
Our profit target is $97 with a trailing stop-loss of $73. Exit the position on 19 April 2024. |
