Crown Castle vs American Tower Which Is More Profitable?

Crown Castle and American Tower are two of the leading players in the telecommunications infrastructure industry. Both companies operate as Real Estate Investment Trusts (REITs) and own and operate cell towers and other wireless communication infrastructure. Investors often compare the stocks of these two companies due to their similar business models and market positions. In this analysis, we will evaluate the strengths and weaknesses of Crown Castle and American Tower stocks, as well as the potential growth opportunities and risks for each company.

Crown Castle or American Tower?

When comparing Crown Castle and American Tower, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Crown Castle and American Tower.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Crown Castle has a dividend yield of 7.52%, while American Tower has a dividend yield of 4.17%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Crown Castle reports a 5-year dividend growth of 7.93% year and a payout ratio of 222.15%. On the other hand, American Tower reports a 5-year dividend growth of 15.41% year and a payout ratio of 276.77%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Crown Castle P/E ratio at 36.79 and American Tower's P/E ratio at 82.51. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Crown Castle P/B ratio is 8.53 while American Tower's P/B ratio is 25.16.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Crown Castle has seen a 5-year revenue growth of 0.23%, while American Tower's is 0.41%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Crown Castle's ROE at 21.01% and American Tower's ROE at 28.21%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $103.91 for Crown Castle and $195.88 for American Tower. Over the past year, Crown Castle's prices ranged from $92.48 to $120.92, with a yearly change of 30.75%. American Tower's prices fluctuated between $170.46 and $243.56, with a yearly change of 42.88%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.