As of June 21, 2025, American Tower Corp's estimated intrinsic value ranges from $173.56 to $278.68 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $278.68 | +28.1% |
| Discounted Cash Flow (5Y) | $237.21 | +9.1% |
| Dividend Discount Model (Multi-Stage) | $195.79 | -10.0% |
| Dividend Discount Model (Stable) | $208.84 | -4.0% |
| Earnings Power Value | $173.56 | -20.2% |
Is American Tower Corp (AMT) undervalued or overvalued?
With the current market price at $217.48, the stock appears to be fairly valued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate American Tower Corp's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.47 | 0.63 |
| Cost of equity | 6.0% | 8.4% |
| Cost of debt | 4.0% | 7.0% |
| Tax rate | 6.7% | 8.0% |
| Debt/Equity ratio | 0.36 | 0.36 |
| After-tax WACC | 5.4% | 7.9% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $237 | $145,806M | 86.3% |
| 10-Year Growth | $279 | $165,221M | 75.3% |
| 5-Year EBITDA | $183 | $120,644M | 83.4% |
| 10-Year EBITDA | $224 | $139,736M | 70.8% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $7,436M |
| Discount Rate (WACC) | 7.9% - 5.4% |
| Enterprise Value | $94,514M - $137,505M |
| Net Debt | $34,759M |
| Equity Value | $59,755M - $102,746M |
| Outstanding Shares | 468M |
| Fair Value | $128 - $219 |
| Selected Fair Value | $173.56 |
| Metric | Value |
|---|---|
| Market Capitalization | $101811M |
| Enterprise Value | $136570M |
| Trailing P/E | 37.11 |
| Forward P/E | 30.28 |
| Trailing EV/EBITDA | 18.70 |
| Current Dividend Yield | 302.45% |
| Dividend Growth Rate (5Y) | 12.38% |
| Debt-to-Equity Ratio | 0.36 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $83.61 |
| Discounted Cash Flow (5Y) | 25% | $59.30 |
| Dividend Discount Model (Multi-Stage) | 20% | $39.16 |
| Dividend Discount Model (Stable) | 15% | $31.33 |
| Earnings Power Value | 10% | $17.36 |
| Weighted Average | 100% | $230.75 |
Based on our comprehensive valuation analysis, American Tower Corp's weighted average intrinsic value is $230.75, which is approximately 6.1% above the current market price of $217.48.
Key investment considerations:
Given these factors, we believe American Tower Corp is currently fairly valued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.