American Tower Corp (AMT): Today's Featured Telecommunications Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

American Tower ( AMT) pushed the Telecommunications industry higher today making it today's featured telecommunications winner. The industry as a whole closed the day down 0.4%. By the end of trading, American Tower rose 86 cents (1.2%) to $72.50 on light volume. Throughout the day, 1.7 million shares of American Tower exchanged hands as compared to its average daily volume of 2.5 million shares. The stock ranged in a price between $71.56-$72.64 after having opened the day at $71.72 as compared to the previous trading day's close of $71.64. Other companies within the Telecommunications industry that increased today were: Zoom Technologies ( ZOOM), up 12.4%, Nexxus Lighting ( NEXS), up 10.2%, eOn Communications Corporation ( EONC), up 4.8%, and Telestone Technologies Corporation ( TSTC), up 4.7%.
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American Tower Corporation, a real estate investment trust, operates as a wireless and broadcast communications infrastructure company. It develops, owns, and operates communications sites. American Tower has a market cap of $28.65 billion and is part of the technology sector. The company has a P/E ratio of 63.1, equal to the average telecommunications industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Shares are up 19.4% year to date as of the close of trading on Tuesday. Currently there are 15 analysts that rate American Tower a buy, no analysts rate it a sell, and two rate it a hold.

TheStreet Ratings rates American Tower as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations, notable return on equity and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the negative front, Motricity ( MOTR), down 11.7%, Elephant Talk Communications ( ETAK), down 9.8%, RIT Technologies ( RITT), down 8.1%, and magicJack VocalTec ( CALL), down 6.8%, were all laggards within the telecommunications industry with Equinix ( EQIX) being today's telecommunications industry laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the telecommunications industry could consider iShares Dow Jones US Telecom ( IYZ) while those bearish on the telecommunications industry could consider ProShares Ult Sht Telecommunication ( TLL).

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