American Tower

American Tower’s moat is multi‑layered. First, switching costs are high: carriers face costly, multi‑month engineering and permitting to relocate radios and backhaul, so churn is low and leases are multiyear and non‑cancellable.

Second, efficient scale and zoning barriers limit rational new entrants in many markets, while co‑location creates a structural cost advantage because incremental tenants add revenue at minimal site‑level cost, lifting returns as tenancy ratios rise.

Third, CoreSite adds an interconnection moat in key U.S. metros where ecosystems of networks, clouds and enterprises create sticky, premium‑priced colocation. Finally, contracts feature embedded escalators that compound over time.

Risks to monitor include network sharing, small‑cell densification that may shift some spend off macro towers in dense urban cores, and satellite direct‑to‑device as a niche back‑up link. Overall, the moat is durable given the critical nature of sites and the cost to replicate location, power, and backhaul.

Annual price escalators provide visible, contractual pricing power: approximately 3% fixed in the U.S. and inflation‑linked clauses in most international markets. CoreSite’s dense interconnection campuses support additional pricing leverage as customers value low‑latency cross‑connects and cloud on‑ramps.

Offsets include carrier consolidation‑related churn (notably T‑Mobile/Sprint) and periodic macro slowdowns that can delay commencements, but the embedded escalators plus co‑location economics continue to drive mid‑single‑digit organic tenant billings growth globally.

AMT’s revenue base is highly recurring with long‑term, non‑cancellable contracts and substantial backlog exceeding 55 billion dollars. Management raised 2025 guidance for property revenue, EBITDA and AFFO on steady leasing demand, while acknowledging FX can move GAAP net income materially.

Near‑term, U.S. churn tied to the T‑Mobile master lease keeps reported growth modest, but the runway from 5G capacity adds, spectrum upgrades and international 4G/5G rollouts supports continued organic growth. CoreSite’s secular tailwinds from cloud and AI interconnection add another predictable growth vector.

Key unpredictable elements are FX in emerging markets and carrier capex timing.

Leverage sits around 5.1x net debt to annualized Q2’25 EBITDA with about 35.4 billion dollars of net debt and roughly 10.5 billion dollars of liquidity. The company repaid 2025 maturities and issued longer‑dated euro notes, and it continues to prioritize debt paydown.

On cash generation, trailing twelve‑month free cash flow is approximately 3.7 billion dollars (Q3’24 FCF 1.037b, Q4’24 0.746b, Q1’25 0.955b, Q2’25 0.969b). The quarterly dividend was 1.70 dollars in Q2’25 and management has resumed mid‑single‑digit growth, with payout covered by AFFO.

FX remains a swing factor and leverage is higher than we prefer, but the funding profile and liquidity are solid for a large, investment‑grade tower REIT.

AMT’s recent actions reflect discipline: it exited India in September 2024 for about 2.5 billion dollars and directed proceeds to debt reduction; it also sold Australia/New Zealand sites and completed the sale of a South Africa fiber subsidiary, simplifying the portfolio and lifting earnings quality.

Within data centers, AMT deepened its Stonepeak partnership to fund CoreSite growth, formed a JV to build a new Denver facility, and in Q2’25 bought its DE1 data‑center building to expand capacity. 2025 capex guidance of roughly 1.6 to 1.7 billion dollars includes around 600 million dollars for CoreSite development and up to 2,450 new tower builds globally.

Stock‑based comp is modest relative to cash generation (about 101 million dollars in 1H’25). The dividend policy targets steady per‑share growth with flexibility to prioritize deleveraging.

CEO Steven Vondran, a two‑decade company veteran and former U.S. Tower head, succeeded Tom Bartlett on February 1, 2024, ensuring continuity in strategy and execution. Compensation structure emphasizes financial targets and long‑term equity.

The team has navigated portfolio cleanup, FX volatility and capital markets with measured steps, while keeping focus on organic growth and CoreSite development. Governance around the Stonepeak data‑center partnership includes AMT control and aligned incentives.