5. American Tower Corporation (NYSE:AMT)
Short Interest as % of Shares Outstanding: 1.09%
Number of Hedge Fund Holders: 63
American Tower Corporation (NYSE:AMT) is a prominent global REIT that manages a vast portfolio of over 224,000 communication sites across 25 countries. This extensive network includes wireless towers, distributed antenna systems, and data centers. The company leases space on these sites to a diverse group of clients, including wireless service providers, media companies, and government agencies. It ranks 5th on our list of the best 5G stocks to buy according to short sellers.
As a major independent player in wireless communications infrastructure, the company is positioned to benefit from the growing demand for data and the expansion of 5G networks. With the increasing investment by carriers in network capacity to support rising mobile data consumption, its broad and scalable infrastructure is ideally suited to meet these needs. The company’s assets are essential for supporting wireless networks as they provide extensive coverage that aligns with the ongoing rollout of 5G technology.
In the second quarter, American Tower (NYSE:AMT) saw a 4.6% year-over-year increase in total property revenue, reaching $2.85 billion. Tenant billings also showed strong growth, rising 6.1% year over year to $119 million. The increase reflects a 5.3% rise in organic tenant billing, amounting to $103 million, driven by the expanding deployment of 5G and higher demand for mobile data services.
According to a study by Next Move Strategy Consulting, North America is expected to lead the global 5G market due to high adoption rates and advanced infrastructure. Their study highlights that 60% of North American consumers are willing to pay more for 5G coverage. It also projects that 5G will add $2.2 trillion to the global economy from 2020 to 2030, with North America expected to benefit significantly. American Tower’s (NYSE:AMT) substantial presence in the U.S. and Canada, with 42,905 communication sites, contributing $1.32 billion in revenue in Q2, makes the company a dominant player in the 5G landscape.
Additionally, its data center segment, CoreSite, reported its second-highest quarter of new business signings, which shows continued growth in this area. Overall, the company’s broad asset base, along with its ability to adapt to industry trends and high demand for connectivity, positions it well for ongoing success.
63 hedge funds had stakes worth nearly $3 billion in American Tower (NYSE:AMT) in the second quarter of 2024. Akre Capital Management owns 6.13 million of the company shares worth $1.2 billion, making it the most significant shareholder of the company as of Q2.
Baron Real Estate Fund stated the following regarding American Tower Corporation (NYSE:AMT) in its first quarter 2024 investor letter:
“Following a more than 30% rebound in the fourth quarter of 2023, shares of American Tower Corporation (NYSE:AMT) lagged in the first quarter of 2024. The uncertainty around the timing and ultimate financial impact of American Tower’s India business sale, ongoing lower overall spending by wireless carriers, and higher interest rates weighed on the company’s shares. Please refer to our “Top Net Purchases” section for our rationale for acquiring additional shares.
In the first quarter, we continued to acquire additional shares of American Tower Corporation, a global operator of over 200,000 wireless towers. We believe that 2023 marked a trough in earnings growth, financing/interest rate headwinds, and valuation bottoming. Looking ahead, we are more optimistic about the company’s prospects due to its: i) accelerating growth expectations; ii) cash flow stability underpinned by core developed markets; iii) secular demand drivers such as growing mobile data usage, 5G spectrum deployment and network investment, edge computing, and connected homes and cars, which will require increased wireless bandwidth and increased spending by the mobile carriers; and iv) strong growth within CoreSite, its network-dense data center company, and optionality with that business segment as future network needs and architecture evolve.”
