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As mobile technology advances, the need for macro-cell towers to transmit signals to and from devices rises. This creates opportunities for investors in Cell Tower REITs, which own and operate macro cell towers. If you want to know more about Cell Tower REITs and the investment opportunities they offer, keep reading.
The Best Cell Tower REITs To Buy
American Tower Corporation (NYSE: AMT)
American Tower is the largest international REIT for cell towers. This company currently has communications towers in 20 different countries across three continents. With a portfolio of 181,000 international towers, including over 40,500 macro towers in the US alone, American Tower is the largest cell tower ownership company in the US as well.
After a quick downturn last year, American Tower made up its market losses and recorded its highest share price at over $302 last August. Analysts are predicting a huge return increase for next year as American Tower takes advantage of the 5G trend. The company currently has strategic relationships with companies like T-Mobile and has been aggressive in its acquisitions, most recently announcing its intention to buy Coresite Realty. With its size and breadth, American Tower is likely to continue performing well regardless of the current REIT sector climate.
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SBA Communications Corporation (NASDAQ: SBAC)
SBA Communications is another regionally diversified REIT. The company leases and develops wireless infrastructure, including wireless towers, small cells, distributed antenna systems, and more for use by wireless broadband providers. SBA Communications operates in the US and its territories, as well as Canada, Central America, South America, and South Africa. With over 40,500 existing towers, including 30,000 towers across North and South America, SBA Communications is a major player in the industry.
SBA Communications' market performance has been impressive, with consistent growth for the past three quarters. Its last quarter’s performance gained $589 million in revenue, up by 12.7% from the prior year. The company is expecting a boost in revenue from increased leasing activity this year, making it a great pick for investors looking for cell tower stocks that will continue to perform well.
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High Yield Cell Phone Tower REITs
Crown Castle International Corp. (NYSE: CCI)
As the main competitor to American Tower Corporation, Crown Castle is the second-largest REIT in the telecommunications infrastructure sector. Based in the US, the company currently has over 40,000 tower locations and nearly 80,000 route miles of fiber supporting small cells and fiber solutions. Crown Castle provides communications infrastructure for many of the largest publicly traded cell carriers, including T-Mobile.
Crown Castle has one of the highest dividend yields on this list, with a yield of 3.23%. The company saw excellent performance in its last quarter, gaining its highest share price to date. It recently signed a major long-term deal with T-Mobile, positioning itself for further growth. With rising demand for data and increased network installations, Crown Castle is well-positioned for success in the 5G space.
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Cheap Cell Tower REIT
Uniti Group Inc. (NASDAQ: UNIT)
Uniti Group is the cheapest buy on this list of cell tower REITs. After selling most of its towers, the company turned around and purchased 450,000 fiber strand miles. Uniti Group’s holdings now consist of 1.8 million fiber strand miles and 186 cell towers. The majority of the company’s profits come from rent payments or sales of its fiber strands, which are used by wireless networks across the country.
While Uniti Group's market performance has struggled in the past, the company is focusing on producing significant revenue while controlling capital intensity. As 5G networks become essential to our modern infrastructure, Uniti is likely to perform extremely well.
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Should You Buy Cell Tower REITs?
There’s a huge growth potential for cell tower REITs, both in the US and internationally. With the dawn of 5G, the true capabilities of modern bandwidth technology are truly unknown. The success of these REITs in recent years shows just how reliable these network investments are. Regardless of current events, we’re always going to rely on our cell phones to communicate, which makes them a great long-term investment. However, investing involves risk, so do your due diligence and research the individual company to optimize your portfolio and index management.
The Development of 5G Technology
The cell tower REITs sector has grown dramatically as 5G technology has become more widespread. 5G was introduced in the US in 2019 as the successor to 4G network technology, providing faster download speeds and much more bandwidth. Networks will need to build a huge number of communications towers to support 5G devices. Because of this, macro tower REITs have been very successful this year. Telecommunications companies rarely own their macro cell towers - instead, cell tower REITs own them and lease them out to the network providers that need them. With the potential for new technologies like self-driving cars and smart cities, 5G network providers will likely see drastic increases in expansion, demand, and market performance.
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Cell Tower REITs: Final Thoughts
It’s not just cell phone providers who are starting to realize the huge potential of 5G networks. Companies like Dish Network and Hoya Capital Real Estate are even starting to invest in 5G distribution tower sites. The price per share of these REITs has steadily climbed with increased tower activity, and network spending has never been as high as it is today. Investors won’t want to miss out on the REIT sector as it will probably be a huge part of our high-tech, developing economy.
Cell Tower REIT FAQ
1. What is the best cell tower REIT?
American Tower Corporation is the best-performing cell tower REIT. The company has a portfolio of 181,000 international towers, with over 40,500 macro towers in the US alone.
2. Are Cell Tower REITs still a good investment?
Cell tower REITs can be a good investment, offering stability and growth. While there are risks, such as the cost of using a cell tower going up, the market for these REITs is growing.
3. Which REITs pay the highest dividend?
Crown Castle International Corp. (NYSE: CCI) boasts one of the highest dividends in the REIT space, currently yielding 3.23%.
4. What are Cell Tower REITs?
Cell Tower REITs are companies that own and operate cell phone towers, generating revenue from leasing space to wireless providers.
5. What company owns the most 5G towers?
American Tower currently has the most cell towers, with over 181,000 international towers in its portfolio. Crown Castle and SBA Communications are close behind, with over 40,000 cell towers each.
