Invest in the Tower SpaceComments Off on Invest in the Tower Space
Given strong secular fundamentals and a number of possible industry and company specific catalysts, Jonathan Schildkraut and Justin Ages of Evercore ISI are recommending investment in the tower space. The analysts referenced Sprint’s stronger network plan, public safety, and Dish spectrum as catalysts. “Given the balance of these factors across the public players, we believe investors can earn the highest risk-adjusted return by owning the basket of tower operators – and, as such, are upgrading CCI to BUY (from hold) and increasing our PT [price target] to $92 (from $86),” Schildkraut and Ages explained. The two noted that CCI derives 94% of site leasing revenue in the U.S. (vs. SBAC at 82% and AMT at 66%). “With a number of potential U.S.-centric catalysts on the horizon, CCI should be well positioned. In particular, we look for a more aggressive Sprint network build plan, which could include 9K+ new sites, and while longer-dated, we expect news flow around the timing and scale of public safety to begin to emerge – now that the FirstNet has received its funding,” they stated.