Crown Castle is being touted by the Motley Fool as “a safe haven” in the China trade wars even though some concessions are currently underway (see story above). “Its operations are only in the U.S., its customers are a stable group including Verizon and AT&T, and it’s riding the wave of 5G, which should bring it more business,” the irreverent market analyst site said Wednesday.
While Crown needs steel to build its cell towers, the Fool states, that’s only a part of its $540 million third quarter capital expenditure budget with $120 million of that going to towers.
“It’s no longer a question of when: 5G is here, and as carriers build out the networks and launch more 5G services, more cell towers will be required,” said the Fool, “Crown Castle will also be able to charge higher rates because of the power and processing required with 5G.”
Being able to operate as a REIT, the analysts pointed out, is what makes it appealing to income-seeking investors in that it’s required to distribute 90 percent or more of its taxable income. They pointed out the dividend has grown from a $0.35 quarterly dividend issued in February 2014, to $1.20 most recently. “Meanwhile, its stock is up 23 percent year to date,” they added.
December 16, 2019