10 Best Stocks to Buy for the Long-Term According to Charles Akre

4. American Tower Corporation (NYSE:AMT)

Akre Capital Management’s First Major Purchase: 2012

Akre Capital Management’s stake value: $1.41 Billion

Number of Hedge fund holders as of Q3: 73

American Tower Corporation (NYSE:AMT) provides wireless communication infrastructure and manages over 224,000 communication sites. It also boasts of a highly interconnected footprint of U.S. data center facilities. It is one of Charles Akre’s top stock holdings despite underperforming the broader market, going by its 8% year-to-date drop.

Despite recent underperformance, American Tower Corporation (NYSE:AMT) is a solid long-term investment because of its strong role in the 5G rollout. Over 50% of its towers already support 5G, and this will keep driving demand for its services. As a key player in wireless infrastructure, the company benefits from the growing need for data and 5G network expansion. Its extensive infrastructure is essential for supporting wireless networks and meeting the rising demand for mobile data.

The company also stands to gain from the increasing demand for data services and data centers, especially with the rise of artificial intelligence. Its diverse portfolio, including data centers and both domestic and international towers, provides a strong foundation for long-term growth. By diversifying, American Tower has capitalized on global trends in data usage and wireless connectivity.

By 2029, analysts predict that mobile data usage will triple, requiring ongoing network infrastructure investment. Consequently, American Tower is positioned to profit from the rising demand for data services, which fits nicely with the core business model.

Here is what Mar Vista Strategic Growth Strategy stated the following regarding American Tower Corporation (NYSE:AMT) in its Q3 2024 investor letter:

“American Tower Corporation’s (NYSE:AMT) stock rebounded nearly 20% during the third quarter, helped by the tailwind of lower interest rates. The stock has now appreciated more than one-third since U.S. 10-Yr Treasury interest rates peaked in late April 2024. As a levered REIT, lower rates benefit AMT’s equity value through a lower cost of debt and a higher value for its long-duration cash flows. Fundamental expectations did not change materially during the quarter as the company modestly increased their growth expectations for the year. The long-term global opportunities for 5G deployment, edge-of-network computing, and datacenters, remain attractive and are not fully reflected in the current stock price, in our opinion.”