NEW YORK-American Tower Corp.’s stock has been upgraded to “Strong Buy” by Raymond James & Associates Inc. in anticipation of several financial actions expected to occur by early 2003.
American Tower is expected to announce structural separation of its Verestar satellite division before year-end, which Raymond James believes will reduce the company’s leverage, cash interest expense and capital expenditures. The analyst firm also believes American Tower is planning to sell non-core assets, which could amount to upward of $100 million. In addition, the company is likely to become free cash-flow positive in early 2003 and likely will resolve its 2.25-percent convertible note PUT situation by the first quarter 2003.
Raymond James maintains a $5 price target for American Tower, which it derived through a discounted cash flow analysis.
Following the upgrade announcement, shares of American Tower soared up more than 26 percent to trade at $3.68 per share, above competitor Crown Castle International Corp.’s $3.50.
Separately, SpectraSite Holdings Inc., which filed for Chapter 11 bankruptcy protection earlier this month, has been notified it will be delisted from the Nasdaq Small Cap Market, effective Nov. 26. SpectraSite said it will not appeal the delisting because there is no assurance the stock will continue to be traded or that its liquidity will not be adversely affected.
SBA Communications Corp. was notified last week it will face delisting from the Nasdaq because it has failed to meet the required $1 per share minimum for 30 consecutive trading days.
