Earnings Preview: What To Expect From SBA Communications’ Report

Valued at a market cap of $24.3 billion, SBA Communications Corporation (SBAC) is a leading telecom infrastructure REIT that owns and operates wireless communication towers primarily in the U.S. and Latin America. Headquartered in Boca Raton, Florida, the company generates recurring revenue by leasing tower space to major wireless carriers.

SBAC is expected to release its fiscal Q1 earnings results on Monday, Apr. 28. Ahead of this event, analysts project the communications tower operator to report an AFFO of $2.95 per share, reflecting a decrease of 10.3% from $3.29 per share in the year-ago quarter. However, the company holds a solid track record of consistently surpassing Wall Street's bottom-line estimates in the last four quarterly reports.

In the most recent quarter, SBAC surpassed the consensus AFFO estimate by 8.4%, primarily driven by steady growth in domestic site leasing revenues and a resurgence in international leasing activity, particularly in markets like Brazil.

For fiscal 2025, analysts forecast SBAC to report an AFFO of $11.97 per share, down 10.5% from $13.37 per share in fiscal 2024. 

SBAC shares have surged 17.6% over the past 52 weeks, outperforming the broader S&P 500 Index's ($SPX) nearly 5.5% gain and the Real Estate Select Sector SPDR Fund's (XLRE) 11.8% returns over the same time frame. 

SBA Communications has benefited from the ongoing expansion of 5G networks and increased demand for wireless infrastructure. The company's strategic investments and operational efficiencies are expected to support continued growth and shareholder value creation.

On Feb. 24, SBA Communications reported its fourth-quarter earnings, and its shares jumped 3% the next trading session. Total revenue grew 2.8% from the prior-year period to $693.7 million, driven by solid gains in both site leasing and development activity, surpassing Street forecasts by 1.8%. Operating income surged by 82.3% year-over-year to $382.3 million, attributed to a significant 33.1% decline in operating expenses. The company also announced a 13% increase in its quarterly cash dividend to $1.11 per share, demonstrating confidence in its financial stability. 

Analysts' consensus view on SBA Communications stock is reasonably optimistic, with a "Moderate Buy" rating overall. Among 19 analysts covering the stock, ten suggest a "Strong Buy," one gives a "Moderate Buy," and eight recommend a "Hold." 

SBAC’s mean price target of $247.94 represents an upswing potential of 7.1% from the prevailing price levels.