American Tower Corporation Earnings: Beats Expectations

S&P 500 (NYSE:SPY) component American Tower Corporation (NYSE:AMT) reported net income above Wall Street’s expectations for the first quarter. American Tower develops, owns, and operates communications sites throughout the country. Among its holdings are wireless communications towers, broadcast communications towers, and distributed antenna system.

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American Tower Earnings Cheat Sheet for the First Quarter

Results: Net income for the infrastructure rose to $221.3 million (56 cents per share) vs. $91.8 million (23 cents per share) in the same quarter a year earlier. This is a more than twofold rise from the year-earlier quarter.

Revenue: Rose 23.8% to $696.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: American Tower Corporation beat the mean analyst estimate of 40 cents per share. It beat the average revenue estimate of $671.4 million.

Quoting Management: Jim Taiclet, American Tower’s Chief Executive Officer stated, “Due to our unique global reach, American Tower is positioned to benefit from strong secular trends in wireless telecommunications in both the US and around the world. As a result of our robust first quarter performance and recent acquisition activities, we have increased the midpoint of our full year 2012 outlook for rental and management revenue, Adjusted EBITDA and AFFO growth to over 16%, 14% and 11%, respectively.”

Key Stats:
The company has seen double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 23.4%, with the biggest boost coming in the second quarter of the last fiscal year when revenue rose 27.1% from the year earlier quarter.

Last quarter marked the fifth straight quarter that the company saw shrinking gross margins, as gross margin fell 0.5 percentage point to 75.5% from the year-earlier quarter. Over that time, margins have contracted on average 1.7 percentage points per quarter on a year-over-year basis.

The company has now beaten estimates the last two quarters. In the fourth quarter of the last fiscal year, it topped expectations with net income of 51 cents versus a mean estimate of net income of 31 cents per share.

Looking Forward: Expectations for the company’s next-quarter performance are higher than they were ninety days ago. Over the past three months, the average estimate for the second quarter has risen to 41 cents per share from 38 cents. The average estimate for the fiscal year is $1.68 per share, a rise from $1.53 ninety days ago.

Competitors to Watch: Crown Castle Intl. Corp., SBA Communications Corp., Syniverse Holdings, Inc., AT&T Inc., Neustar, Inc, WPCS International Inc., Telephone & Data Systems, Inc., Sprint Nextel Corporation, and Verizon Communications Inc.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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