Digital Infrastructure Stock Performance Mixed Over the Past Year

Stocks for the companies in the Inside Towers Intelligence proprietary Digital Infrastructure Value Index have reflected the broader macroeconomic environment. As a group, stock prices across the 14 infrastructure companies in our Index have grown 21 percent over the past 52 weeks. However, sector by sector, results vary widely. 

The Index tracks the stock performance of 14 companies in five digital infrastructure asset classes – towers, data centers, fiber, cable, and diversified infrastructure. We record each company’s stock price at the market close every Friday, tracking them over a 52-week rolling period. We also compare these prices to the U.S. 10-year Treasury Bond rate. 

Stock prices and bond rates have an inverse relationship. Stocks are generally seen as riskier investments compared to bonds. When investors feel confident and willing to take more risks, they tend to buy stocks, increasing stock prices. Conversely, when investors are more cautious, they tend to buy bonds, which drives bond prices up and stock prices down. High inflation can lead to higher interest rates, which can reduce bond prices. Stocks might also be affected by inflation but usually to a lesser extent than bonds. 

Since January 1, 2025, the stock market has experienced volatility. The S&P 500 and Nasdaq Composite have seen modest gains but rising long-term interest rates and high valuations have caused fluctuations. Since early December, the 10-year Treasury Bond yield has approached 5 percent, affecting stocks, although that rate has moderated in recent weeks.

Inflation remains a concern, with prices rising slower than last year. The Federal Reserve is cautious about reducing interest rates further due to strong employment data. A stronger-than-expected job market adds to market uncertainty. Overall, the stock market remains bullish, but volatility and uncertainty are expected to continue throughout the year.

Stocks of tower companies in the Index declined 12 percent over the year. American Tower (NYSE: AMT) is still adjusting after selling its operations in India. The disposition of Crown Castle’s (NYSE: CCI) fiber business remains unresolved, while SBA Communications (NASDAQ: SBAC) performed steadily in its domestic and international operations. In a recent research note, MoffetNathanson analysts said, “the outlook for prospective tower equity returns appears brighter. Carrier leasing activity looks to be improving off the recent bottom. The towercos are slowly but surely chewing through the headwinds to growth – Sprint churn and interest rate refinancing costs – that have plagued them.”

Data center stocks grew by 35 percent over the same period. Equinix (NASDAQ: EQIX), Digital Realty Trust (NYSE: DLR), and Iron Mountain (NYSE: IRM) are all benefiting from increased capacity demand generated by artificial intelligence.

Fiber company stock prices surged in the latter half of 2024, on the news of significant developments and grew 123 percent over the year. Inside Towers reported on Frontier Communications (NASDAQ: FYBR) being acquired by Verizon (NYSE: VZ). Both Lumen Technologies (NYSE: LUMN) and Uniti Group (NASDAQ: UNIT) refinanced debt and announced several significant long-term deals.

Cable companies saw their stock prices drop 21 percent in 2024. Comcast (NASDAQ: CMCSA), Charter Communications (NASDAQ: CHTR), and Cable One (NYSE: CABO) all reported quarterly subscriber net losses attributed to telco and overbuilder fiber-to-the-home and MNO fixed wireless access deployments. Comcast remains the most valuable infrastructure company in our Index with a market cap of $140 billion as of January 17.

Diversified infrastructure companies’ stock prices declined 20 percent over the year. While Brookfield Infrastructure Partners (NYSE: BIP) and DigitalBridge Group (NYSE: DBRG) hold investments across all digital infrastructure asset groups in global markets, their stories are complex and may not be as well received by investors.

For more detailed and up-to-date information on our Digital Infrastructure Value Index, visit: insidetowers.com/intelligence.

By John Celentano, Inside Towers Business Editor