ST. PETERSBURG, Fla.-Raymond James & Associates Inc. has increased its financial expectations, including year-end 2003 price targets, for tower giants Crown Castle International Inc. and American Tower Corp.
Crown Castle’s price target has been increased from $6 to $6.50. Analysts said the previous target was based on expectations the market for new tower leases in the U.S. would decline by 10 percent in 2003. They now believe there is the possibility for demand to be up 10 percent. Raymond James said the main risk to the new price target is the rate at which new tenants are added to towers. Crown Castle’s 2004 EBITDA estimate has also been increased from $449 million to $453 million.
American Tower’s year-end 2003 price target is also now $6.50, upgraded for the same reasons and with similar risks as Crown Castle. The company’s 2003 and 2004 EBITDA estimates have also been increased from $400 million to $410.5 million and from $466 million to $476 million, respectively. Finally, free cash flow estimates for 2003 and 2004 have been increased from $55.2 million to $56.7 million and from $140.1 million to $149.6 million, respectively.
At press time, shares of both companies were trading up, with Crown Castle at $3.90 per share and American Tower at $5.42 per share.
