AMT to Slow Down Global M&A?

Kevin Smithen and Will Clayton, analysts at Macquarie Securities, recently upgraded American Tower to “Outperform” with a target price of $107. “We believe that AMT’s management will slow down the pace of global M&A over the next 12-18 months and focus on VZ tower lease-ups and a potential public safety opportunity in 2016, despite a plethora of assets reportedly for sale in Europe, India, Africa and LatAm,” the analysts wrote. “In our view, tower stocks perform the best when there is no M&A and the companies can naturally deleverage and return excess cash to shareholders.” American Tower is set to release their first quarter 2015 earnings on April 30 before the markets open. “While we are not expecting a 30-40% tower rally as in past years, we do think investors can generate a 15% total return on AMT shares with limited downside risk. If LatAm sentiment or FX begin to improve, we could see ~10% upside to our new $107 TP, with Sprint’s capex plans and PCIA as near-term catalysts,” Smithen and Clayton explained.