Bernstein adjusts tower stock price targets on higher debt costs

Investing.com - Bernstein revised its estimates for American Tower (NYSE: AMT), Crown Castle (NYSE: CCI), and SBA Communications (NASDAQ: SBAC) on Tuesday to reflect higher refinancing costs on upcoming debt maturities. The firm lowered its price target on American Tower to $212 from $214 and cut SBA Communications' target to $208 from $219, while maintaining its $96 target on Crown Castle.

The firm said higher borrowing costs will temper its outlook for adjusted funds from operations per share growth in the medium term as lower-coupon debt rolls over at higher rates. Bernstein partially offset this headwind by considering SpaceX's emergence as a potential fourth nationwide tenant following the company's recent spectrum purchase.

Bernstein maintained its Outperform rating on American Tower and Crown Castle, citing growing mobile data consumption, fixed wireless access adoption, and ongoing network densification as support for durable leasing demand. The firm kept its Market-Perform rating on SBA Communications.

American Tower remains Bernstein's preferred name in the sector based on portfolio quality and execution, with CoreSite as a growth engine showing double-digit cash revenue growth and record leasing activity. The firm said management has continued to simplify the international portfolio, including 2026 exits from the Philippines and Bangladesh following earlier divestitures in India, Australia, and New Zealand.

Bernstein said it kept its valuation multiples on the higher end at 16-18 times next-twelve-months-plus-one adjusted funds from operations while the SpaceX network build narrative remains active. The firm said it views a mobile virtual network operator outcome as more likely than a network build, which would be neutral for tower companies.

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