American Tower (NYSE: AMT) has hit a speed bump in recent years. The communication infrastructure operator's adjusted funds from operations (FFO) slowed considerably last year, rising only 2.1% for the full year after growing at a double-digit pace for years. As a result, the company's dividend growth rate has also slowed, from a 10% annualized rate at the end of last year to 3.2% annualized in the second quarter. That slowdown has weighed heavily on its shares, which are down about 30% from its peak three years ago. This decline pushed up its dividend yield to nearly 3%, more than double the S&P 500's yield.

The infrastructure REIT initially expected the sluggishness to continue in 2024 because of persistent headwinds. However, the momentum has shifted over the past several months, and the REIT expects to grow much faster this year.

American Tower's growth engine continued to reaccelerate in the second quarter. The REIT's adjusted FFO grew by about 13.5% to $1.3 billion, or $2.97 per share. That extended the momentum it enjoyed in the first quarter, when its adjusted FFO surged 10% after declining 2.1% in the final period of 2023. Several catalysts drove that strong showing, including positive collection trends in India, 5% organic growth in its U.S. and Canadian tower segment, and the second best quarter for new business at its CoreSite data center platform.

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Source Fool.com