American Tower (AMT) Lifts Data Center Outlook On A Valuation Debate

Simply Wall St · 1d ago

American Tower (AMT) reset the conversation by lifting its full year data center revenue growth outlook to about 15%, after reporting record leasing activity and healthier demand across that business.

That guidance change landed after a strong run in the American Tower share price, with a 1 day share price return of 4.08% and a 30 day share price return of 11.80% helping push the latest close to US$188.97. A 1 year total shareholder return of 3.65% and 3 year total shareholder return of 21.68% point to momentum that has been uneven but is currently building.

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After American Tower’s run into the high US$180s, the valuation gap to fair value models and analyst targets has narrowed but not closed. Is the market’s caution on towers and data centers still too stiff?

Most Popular Narrative: 16.8% Undervalued

American Tower last traded at $188.97, while the most followed narrative on the stock pegs fair value at $227.26, which implies a meaningful valuation gap that some investors view as opportunity rather than anomaly.

American Tower (AMT) trades at $182.24 against my fair value of $227.26, roughly a 24.7% discount. For one of the highest-quality REITs in the market, that gap is worth noticing, even if I am not acting on it yet.

See why 2 investors see American Tower as 17% undervalued.

Result: Fair Value of $227.26 (UNDERVALUED)

Still, the American Tower setup can break if higher interest costs squeeze REIT valuations further, or if carrier consolidation drags on new tower and data center leasing.

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

Next Steps

Mixed signals on American Tower so far. If you want to move quickly and judge the trade off yourself, start with the 5 key rewards and 1 important warning sign.

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