American Tower Prices €1B Senior Notes Offering

American Tower Corporation (AMT), the real estate investment trust (REIT) focused on owning and operating wireless and broadcast communications infrastructure, recently announced the pricing of its public offering of senior unsecured notes due 2027 and 2030.

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The notes due in 2027 and 2030 have principal amounts of €500 million (about $584.2 million) each. While the 2027 notes have an interest rate of 0.4% per anum, the 2030 notes have an interest rate of 0.95% per anum. The 2027 notes are being issued at a price equal to 99.4% of their face value and the 2030 notes are being issued at a price equal to 99.26% of their face value.

The company said that intends to use the net proceeds of about €987.7 million (about $1,154.0 million) from the offering to repay existing debt under its $4.1 billion unsecured multicurrency revolving credit facility, as amended and restated in February 2021, and its €1.1 billion unsecured term loan entered into on February 10, 2021. (See American Tower stock chart on TipRanks)

Recently, Morgan Stanley analyst Simon Flannery reiterated a Hold rating on the stock. The analyst, however, raised the price target from $270 to $316, which implies upside potential of 17.3% from current levels.

According to the analyst, tower companies are expected to benefit with the onset of 5G connections. Further, the analyst believes that although tower companies have reached their highest valuations, the absolute multiples are still not that heated up.

The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 8 Buys and 4 Holds. The average American Tower price target of $306.20 implies that the stock has upside potential of 13.4% from current levels.

American Tower scores a 5 out of 10 from TipRanks’ Smart Score rating system, indicating that the stock is likely to perform in line with market expectations. Shares have gained about 11.7% over the past year.