Trade-Ideas LLC identified

American Tower

(

AMT

) as a momo momentum candidate. In addition to specific proprietary factors, Trade-Ideas identified American Tower as such a stock due to the following factors:

  • AMT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $173.9 million.
  • AMT has a PE ratio of 73.
  • AMT is currently in the upper 30% of its 1-year range.
  • AMT is in the upper 25% of its 20-day range.
  • AMT is in the upper 35% of its 5-day range.
  • AMT is currently trading above yesterday's high.
  • AMT has experienced a gap between today's open and yesterday's close of 0.6%.

'Momo Momentum' stocks are valuable stocks to watch for a variety of reasons including historical back testing and price action. Market technicians refer to such stocks as being in a mark-up phase before a possible distribution period and price decline. Technical analysts and traders frequently find that the factors referenced above tend to create a temporary burst of strong wind in a stock's sail. Nevertheless, all successful traders must excel at maximizing gains while keeping losses to an absolute minimum. For that reason, the holding period on momo momentum stocks must always be a primary consideration, and this part of the puzzle is ultimately at the discretion of each individual's risk tolerance and portfolio risk management skills.

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More details on AMT:

American Tower Corporation is a real estate investment trust. It invests in the real estate markets across the globe. The stock currently has a dividend yield of 2%. AMT has a PE ratio of 73. Currently there are 16 analysts that rate American Tower a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for American Tower has been 2.0 million shares per day over the past 30 days. American Tower has a market cap of $41.6 billion and is part of the technology sector and telecommunications industry. The stock has a beta of 0.82 and a short float of 1.4% with 3.37 days to cover. Shares are down 0.5% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates American Tower as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 6.1%. Since the same quarter one year prior, revenues rose by 19.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has slightly increased to $507.16 million or 1.99% when compared to the same quarter last year. Despite an increase in cash flow, AMERICAN TOWER CORP's average is still marginally south of the industry average growth rate of 9.44%.
  • The gross profit margin for AMERICAN TOWER CORP is currently very high, coming in at 70.39%. Regardless of AMT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, AMT's net profit margin of 8.32% is significantly lower than the industry average.
  • AMERICAN TOWER CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, AMERICAN TOWER CORP increased its bottom line by earning $2.01 versus $1.38 in the prior year. For the next year, the market is expecting a contraction of 27.9% in earnings ($1.45 versus $2.01).
  • After a year of stock price fluctuations, the net result is that AMT's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Despite the stock's decline during the last year, it is still somewhat more expensive (in proportion to its earnings over the last year) than most other stocks in its industry. We feel, however, that other strengths this company displays offset this slight negative.

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