American Tower Corp.
), the largest communication tower operator in the world, to beat
expectations when it reports third-quarter 2013 results before
the market opens on Oct 30, 2013.
Why a Likely Positive Surprise?
Our proven model shows that AMT is likely to beat earnings
because it has the right combination of two key ingredients.
The Expected Surprise Prediction or
, which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, is +5.66%. This is a
meaningful and leading indicator of a likely positive earnings
AMT currently has a Zacks Rank #3 (Hold). Note that the stocks
with Zacks Rank #1, 2 or 3 have a significantly higher chance of
beating the earnings. The Sell-rated stocks (Zacks Rank #4 and 5)
should never be considered going into an earnings announcement.
The combination of AMT's Zacks Rank #3 and +5.66% Earnings ESP
makes us confident of a positive earnings beat.
What is Driving the Better-Than-Expected
AMT is expected to benefit from the unprecedented demand for
wireless voice, data and video networks, which has propelled the
demand for tower space by carriers. Increased adaptation of
smartphones coupled with continuous amendment of the LTE networks
by the four major U.S. carriers will also help AMT to bolster its
top line in the first quarter. In addition to Brazil and
Mexico, AMT has taken a major initiative to expand its operations
in India. As a result, the company is continuously acquiring
towers which, we believe, will generate long-term sustainable
business for the company.
Despite such strong fundamentals, AMT has a highly leveraged
balance sheet, which may impede borrowing and refinancing at
favorable rates. Additionally, higher customer concentration and
considerable exposure to foreign exchange risk may hurt
Other Stocks to Consider
Other companies you may consider on the basis of our model, which
have the right combination of elements to post an earnings beat
this quarter, are as follows:
) with Earnings ESP of +4.35% and a Zacks Rank #2 (Buy).
EastGroup Properties Inc.
) with Earnings ESP of +1.21% and a Zacks Rank #2 (Buy).
Motorola Solutions Inc.
) with Earnings ESP of +2.04% and a Zacks Rank #2 (Buy).
AMER TOWER CORP (AMT): Free Stock Analysis
CUBIC CORP (CUB): Free Stock Analysis Report
EASTGROUP PPTYS (EGP): Free Stock Analysis
MOTOROLA SOLUTN (MSI): Free Stock Analysis
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