After Q3 Success, SBA Communications Ups Full Year Outlook

By The Editors of AGL

October 31, 2017

SBA Communications increased its full-year outlook after experiencing year over year growth in the third quarter, including site leasing revenue, 5.2 percent; tower cash flow, 6.3 percent; adjusted EBITDA, 7 percent; and AFFO per share of 14.4 percent during the third quarter.

“The third quarter was another solid one for SBA,” said Jeffrey A. Stoops, president and CEO. With FirstNet, 600 MHz, 2.5 GHz, and other deployments by our customers still ahead in the U.S. and material network investment expected from our customers in our international markets, we remain very optimistic about the future and our ability to create additional shareholder value through consistent and material growth in AFFO per share.”

Domestically, SBA’s operational customer activity included a mix of new leases and amendments, with growth driven by LTE capacity upgrades as well as AWS-3 overlays, 1,900, 700 and 600 megahertz deployments. In the coming year, the towerco is looking forward to applications from AT&T for the First Responder Network Authority (FirstNet).

“While this year has been steady in the United States, we believe operational leasing activity next year should be better,” Stoops said. “We’ve begun to see some initial applications from AT&T incorporating FirstNet needs, although nothing material yet.”

The tower industry has a long runway for growth in the 2.5 GHz band, as well as continued deployments AWS-3, 600 MHz and 700 MHz bands. Plus, DISH is getting close to the FCC deadline to deploy on its spectrum. Stoops also reacted to rumors of a new Sprint deployment, perhaps in keeping with the reported breakdown of its merger talks with Sprint.

“Sprint appears to be on the verge of the first material investment in macro radios and antennas in years,” Stoops said. “As we’ve stated in the past, we think being a predominantly U.S. macro tower company will be a great position to be in for years to come. And while things are good in the U.S. and expected to get better, we continue to be very pleased with our international results.”

Quotes courtesy Seeking Alpha