Infrastructure class: Evolving
Infrastructure sub-sector: Communication
American Tower owns, operates and develops wireless communications and broadcast towers across the globe. The business currently operates around 40,000 wireless towers in the US, 57,000 in India, and 43,000 across the rest of the world. It is one of a number of communications companies owned by the M&G Global Listed Infrastructure Fund that work to connect an increasingly digital society.
American Tower is a market leader in a structurally growing industry with very high barriers to entry. Global data traffic has increased rapidly over the past five years and is forecasted to follow the same trajectory in the years to come. American Tower can take full advantage of that tailwind, as it operates in some of the fastest-growing geographies, in terms of data usage, worldwide. Increasing data usage leads to higher revenues for the company’s tenants (wireless carriers), enabling those tenants to invest in and expand their coverage – this subsequently creates incremental investment opportunities for the company. American Tower’s particular strength in making such incremental investments is reflected by its historical ability to grow its return on invested capital, while simultaneously expanding its site count rapidly.
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