American Tower CorporationAMTNYSE

Overview Intelligence Charts News Fundamentals DCF Key Metrics TTM Financials Earnings Growth Rating Analysts Institutional Peers Historical

DCF Valuation

DCF Valuation Summary

Buy

Fair Value: $226.32 per share(market-calibrated)

+17.2%

Upside to Fair Value

Current

$193.09

Pure Model

$232.07

Fair Value

$226.32

Bull Case

$309.68

Bear Case

$168.17

Market Reality Check

Model Terminal Growth

2.50%

Market-Implied Growth

1.66%

Calibrated Growth

2.29%

Fair value uses 75% model / 25% market-implied terminal growth. Pure model: $232.07.

What's Driving This Ratingfor AMT

↓

CapEx normalizing toward maintenance

Historical CapEx is 15.15% of revenue (heavy investment phase). Model fades this to 2.50% by Year 10, freeing up ~$1.9B in annual FCF. This is the biggest driver of long-term cash flow improvement.

↑

Margin expansion modeled

Current EBIT margin is 36.85% — below the sector mature average of 44.60%. Model expands margins as the business scales and operating leverage kicks in. Year 10 EBIT reaches $5.4B (36.85% margin).

→

Moderate revenue growth

Analyst consensus projects 8.10% revenue growth, fading to 2.50% by Year 10. Revenue reaches $14.6B (vs $10.1B today).

✓

Model and market roughly agree

Market-implied terminal growth of 1.66% is close to the model's 2.50% (only 84bps apart). The DCF assumptions are well-aligned with how the market is pricing this stock.

✓

Strong cash flow conversion

Year 10 FCF/EBITDA conversion of 89.58% indicates efficient cash generation. FCF reaches $8.1B by Year 10 (55.63% FCF margin).

Weighted Average Cost of Capital (WACC)

Cost of Equity (CAPM)

Risk-Free Rate (Rf)4.50%

Beta (β)0.94

Market Risk Premium4.50%

*Using current implied premium (4.5% per Damodaran 2026), not historical (6.5%)

Cost of Equity (Re)8.75%

Cost of Debt

Pre-tax Cost of Debt2.54%

Tax Rate10.11%

After-tax Cost of Debt2.29%

Equity Weight (E/V)67.23%

Debt Weight (D/V)32.77%

WACC Calculation

WACC = (E/V × Re) + (D/V × Rd × (1-Tc))

WACC = (67.23% × 8.75%) + (32.77% × 2.29%)

= 6.63%

10-Year Free Cash Flow Projections(showing years 1, 3, 5, 7, 10)

Year	Year 1	Year 3	Year 5	Year 7	Year 10
Revenue	$10.9B	$12.1B	$12.9B	$13.6B	$14.6B
EBIT	$4.0B	$4.4B	$4.8B	$5.0B	$5.4B
Tax	$408M	$449M	$482M	$507M	$546M
NOPAT	$3.6B	$4.0B	$4.3B	$4.5B	$4.9B
+ Depreciation	$2.8B	$3.0B	$3.3B	$3.4B	$3.7B
- Capex	$1.7B	$1.5B	$1.2B	$914M	$366M
- Δ NWC	$82M	$69M	$32M	$33M	$36M
Free Cash Flow	$4.6B	$5.5B	$6.3B	$7.0B	$8.1B
Discount Factor	0.938	0.825	0.725	0.638	0.526
Present Value	$4.4B	$4.5B	$4.6B	$4.5B	$4.3B

FCF Formula: Free Cash Flow = NOPAT + Depreciation - Capex - Change in Net Working Capital

Terminal Value Calculation

Perpetuity Growth Method

Year 10 FCF$8.1B

Terminal Growth Rate2.50%

WACC6.63%

TV = FCF₁₀ × (1+g) / (WACC-g)

Terminal Value$202.2B

PV of Terminal Value$106.4B

Exit Multiple Method

Year 10 EBITDA$9.1B

Exit Multiple (EV/EBITDA)22.0x

TV = EBITDA₁₀ × Exit Multiple

Terminal Value$200.1B

PV of Terminal Value$105.3B

Valuation Summary

Perpetuity Growth Method

PV of Projected FCFs$44.5B

PV of Terminal Value$106.4B

Enterprise Value$150.9B

(-) Net Debt$42.0B

Equity Value$108.9B

Shares Outstanding467M

Price per Share$233.24

Exit Multiple Method

PV of Projected FCFs$44.5B

PV of Terminal Value$105.3B

Enterprise Value$149.8B

(-) Net Debt$42.0B

Equity Value$107.8B

Shares Outstanding467M

Price per Share$230.91

Pure Model Fair Value

$232.07

Average of perpetuity growth and exit multiple methods (before market calibration)

Sensitivity AnalysisPrice per Share

WACC ↓ / Growth →	1.50%	2.00%	2.50%	3.00%	3.50%
4.63%	$332.08	$367.31	$419.08	$421.28	$400.94
5.63%	$258.33	$276.09	$299.53	$331.87	$379.39
6.63%	$208.98	$219.28	$232.07	$248.39	$269.92
7.63%	$172.63	$179.15	$186.94	$196.41	$208.17
8.63%	$144.21	$148.59	$153.68	$159.68	$166.85

How to read: This table shows how the valuation changes with different WACC (discount rate) and terminal growth rate assumptions. Green = undervalued, Red = overvalued.

Scenario Analysis

Bear Case

$168.17

-12.9% vs current

• -25% vs analyst consensus
• Terminal growth: 2.0%
• Beta: 1.18

Base Case

$232.07

20.2% vs current

• Analyst consensus
• Terminal growth: 2.5%
• Beta: 0.94

Bull Case

$309.68

60.4% vs current

• +25% vs analyst consensus
• Terminal growth: 3.0%
• Beta: 0.80

Key Assumptions & Drivers• Real Estate Sector

Growth Assumptions (Select Years)

Year 1 Revenue Growth8.10%

Year 3 Revenue Growth6.10%

Year 5 Revenue Growth2.50%

Year 7 Revenue Growth2.50%

Year 10 Revenue Growth2.50%

Terminal Growth Rate2.50%

Margin & Efficiency

Current EBIT Margin36.85%

Terminal EBIT Margin44.60%

Tax Rate10.11%

Historical Capex / Rev15.15%

Terminal Capex / Rev2.50%

NWC / Revenue10.00%

Key Drivers: Revenue growth, operating margin expansion, capex efficiency, and working capital management are the primary drivers of cash flow generation. Terminal value assumptions significantly impact final valuation.

Institutional-Grade Methodology

Actual Company Data: Revenue, EBIT, Capex, NWC, Tax Rate, Interest Expense, Beta

Market Assumptions: Risk-free: 4.5% (10Y), MRP: 4.5% (Damodaran 2026), Exit: 22x EV/EBITDA (Real Estate sector)

This DCF model is for informational purposes only. Projections are based on assumptions that may not materialize. Past performance does not guarantee future results. Consult a financial advisor before making investment decisions.

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