TenQ

The American Tower story

American Tower leases cell towers worldwide and operates U.S. data centers, with the central question being whether CoreSite and international growth can offset weaker U.S. tower revenue while supporting debt and distributions.

Written from American Tower's own filings with the SEC, and rewritten when it publishes a new earnings release. Updated 2026-09-30.

  • $168.00share price, last close
  • $78.3Bmarket value
  • 19/36TenQ Score checks passed

The story in brief

  • Leasing supports growth. Record CoreSite leasing and robust tower demand helped property revenue rise 6.3% to $2,688 million in the quarter to June 2026.
  • Earnings need context. In the quarter to June 2026, net income attributable to common stockholders rose 136.5%, helped by currency movements, while adjusted funds from operations, or AFFO, rose 3.8%.
  • Debt limits flexibility. American Tower reported net leverage of 4.9x in June 2026, while TenQ’s coverage check puts funds from operations at 0.97x interest plus distributions.

What drives the business

  • American Tower’s tower leases generally have initial noncancelable terms of five to ten years, with annual U.S. rent increases averaging approximately 3% and over $54 billion of future noncancelable tenant lease revenue under agreements in place in December 2025.
  • Its portfolio included 149,686 communications sites and 30 operating U.S. data center facilities in December 2025, with property operations accounting for 97% of revenue in 2025.
  • AT&T, T-Mobile and Verizon accounted for 85% of U.S. & Canada property revenue in 2025, and that segment represented 49% of consolidated revenue.
  • International operations also depend on large carriers, with Airtel and MTN accounting for 81% of Africa & APAC property revenue and Telefónica accounting for 70% of Europe property revenue in 2025.
  • Adding tenants and equipment to existing towers typically brings modest incremental costs, while CoreSite’s record leasing activity in the quarter to June 2026 adds a separate source of demand from enterprises, network operators and cloud providers.

What the price assumes

TenQ does not measure the growth implied by American Tower’s price through a reverse DCF because free cash flow does not measure a property trust’s earnings.

Its FFO yield of 5.7% clears TenQ’s 5.0% threshold, but its FFO multiple of 17.39 exceeds the fixed yardstick of 16.00.

FFO per share grew 9.7% over the last twelve months, while revenue growth of 6.6% remained below TenQ’s sector growth bar of 8.8%.

What could change the story

  • Currency movements can obscure operating progress, and the raised 2026 AFFO outlook includes approximately $29 million of favorable currency effects alongside data center outperformance and one-time expense benefits.
  • Total debt of $37.2 billion against cash and short-term investments of $1.8 billion leaves financing costs important, particularly with FFO failing TenQ’s combined interest and distribution coverage check.
  • The September 2026 financing announcement priced notes at 5.300%, 5.560% and 5.750%, with proceeds intended partly to repay $600.0 million of 1.450% notes, illustrating the cost of replacing lower-rate debt.
  • Carrier concentration makes lease cancellations consequential, and management identified one-time DISH churn as a drag on AFFO per share growth in the quarter to June 2026.

What to watch next

  • The next releases will show whether AFFO per share remains on course for management’s 2026 outlook of $11.00 to $11.17, which represents 3.0% growth at the midpoint.
  • Organic tenant billings growth, which was 1.7% in the quarter to June 2026, will help distinguish underlying tower demand from currency movements and revenue accounting changes.
  • Management’s 2026 property revenue outlook calls for Data Centers growth of 14.9% and U.S. & Canada growth of (3.0)% at the midpoint, with the latter including an estimated negative impact of over 3% from lower noncash straight-line revenue recognition.
  • CoreSite’s leasing conversion and development progress will matter alongside planned 2026 Data Centers development spending of $695 million and total capital expenditures of $1,805 to $1,915 million.

Sources

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