Crown Castle Earnings: Stock Offers Opportunity as Management Cools Fiber Spending

Crown Castle's 2024 second-quarter results were in line with our expectations. Tower revenue grew 4.5% year over year, even as the carriers have slowed equipment upgrades relative to the previous three years. Although its fiber and small-cell businesses posted revenue declines on Sprint cancellations, revenue excluding Sprint churn continued to grow at a healthy pace of 2% and 15%, respectively. Management has taken the right approach to its fiber business by reducing its planned investment and focusing on higher-returning co-location opportunities across its fiber assets. After updating our expectations for the firm's fiber business, we have raised our fair value estimate to $135 per share from $130. We continue to view shares as attractive.