Why American Tower Stock Jumped Today
Shares of American Tower (NYSE: AMT) climbed as much as 6% early Thursday, then settled to trade up around 3.4% as of 12:30 p.m. ET. The move comes after the wireless infrastructure real estate investment trust (REIT) announced better-than-expected second-quarter revenue growth, steady adjusted funds from operations, and a higher outlook for the year.
American Tower's revenue and net income headline numbers were technically a mixed bag relative to Wall Street's expectations. Quarterly revenue climbed 3.6% year over year to $2.772 billion, driven by 4.4% property revenue growth (to $2.729 billion) and handily outpacing estimates for growth of closer to 2%. Meanwhile, net income of $467 million or $1.02 per share declined 47% year over, arriving below analysts' models for earnings of $1.10 per share.
However, adjusted funds from operations (AFFO) is a better metric than net income for gauging the strength of a REIT's operating performance. American Tower's AFFO fell a modest 0.4% year over year to $1.151 billion, or $2.46 per share, above consensus estimates for AFFO of $2.42 per share. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also climbed 4.7% to $1.749 billion.
Source Fool.com
