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American Tower (AMT) Could Be 65% Undervalued As Options Activity Heats Up

Simply Wall St · 1d ago

American Tower (AMT) is back on traders’ radar after a jump in implied volatility on its January 2027 call options, just ahead of the company’s TD Cowen Communications Infrastructure Summit presentation on August 11.

See our latest analysis for American Tower.

American Tower’s recent options activity comes as the stock edges higher, with a 30 day share price return of 4.12% and a 90 day share price return of 2.90%, while the 1 year total shareholder return has declined 11.53%. This suggests short term momentum is building against a weaker longer term backdrop.

If the American Tower story has you watching communications and digital infrastructure, it may be worth broadening your radar with a focused list of 55 AI infrastructure stocks

After American Tower’s recent bounce and rising options expectations, the real tension is between stepping in at today’s level or holding out for a pullback. The next step is to see what the current valuation actually implies.

Price-to-Earnings of 24.1x: Is it justified?

On current numbers, American Tower trades on a P/E of 24.1x, which screens as inexpensive compared to several valuation checks and peers that sit at higher levels.

The P/E multiple compares the share price to earnings per share. For a company like American Tower, which reported earnings growth of 36% over the past year and a net profit margin of 31.1%, this ratio helps investors weigh how much they are paying for each dollar of profit today.

Relative signals point in the same direction. American Tower is flagged as trading at good value overall, sits below the estimated fair P/E of 34.3x, and is also below both the peer average P/E of 45.1x and the North American Specialized REITs industry average of 26x. That suggests the current multiple could have room to move closer to levels implied by the fair ratio if sentiment or earnings expectations shift.

Explore the SWS fair ratio for American Tower

Result: Price-to-Earnings of 24.1x (UNDERVALUED)

However, the American Tower narrative can quickly change if revenue growth of 4.35% slows, or if the 5 year total shareholder return, which declined 29.41%, weighs further on sentiment.

Find out about the key risks to this American Tower narrative.

Another View on American Tower’s Valuation

While the current P/E of 24.1x screens as inexpensive for American Tower, the SWS DCF model points to a different yardstick. It estimates a future cash flow value of $290.46 per share versus the recent price of $175.58, which frames the stock as undervalued using this method.

This raises a practical question for investors: Which signal should carry more weight, today’s earnings multiple or the longer term cash flow view from the SWS DCF model, when you think about position size and timing.

Look into how the SWS DCF model arrives at its fair value.

AMT Discounted Cash Flow as at Aug 2026
AMT Discounted Cash Flow as at Aug 2026

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out American Tower for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 50 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

If this mix of caution and optimism around American Tower feels familiar, act while the data is fresh and shape your own view with the 6 key rewards and 1 important warning sign

Looking for more investment ideas beyond American Tower?

If you are tracking American Tower closely, it is worth lining up a few other ideas now so you are ready when the next opportunity shows up.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.