SBA Communications Corporation SBAC is scheduled to report first-quarter 2025 results on April 28, after the market closes. The company’s quarterly results might display a decline in revenues and adjusted funds from operations (AFFO) per share year over year.

In the last reported quarter, this Boca Raton, FL-based communications tower REIT reported an AFFO per share of $3.47, beating the Zacks Consensus Estimate of $3.36. Results reflected an improvement in site-leasing and site-development revenues.

Over the preceding four quarters, SBAC’s AFFO per share surpassed the Zacks Consensus Estimate on two occasions, met once and missed in the remaining period, the average beat being 0.74%. The graph below depicts this surprise history:

SBA Communications Corporation Price and EPS Surprise

SBA Communications Corporation price-eps-surprise | SBA Communications Corporation Quote

Factors at Play for SBA Communications

The advancement in mobile technology, such as 4G and 5G networks, and the proliferation of bandwidth-intensive applications have propelled growth in mobile data usage globally. This has been spurring the demand for SBA Communications’ wireless communications infrastructure.

However, the ongoing consolidation in the wireless industry is likely to have impacted the company’s first-quarter performance. High interest rates and elevated churn in certain markets where the company operates might have been deterrents to some extent.

Projections for SBA Communications

The Zacks Consensus Estimate for first-quarter site-leasing revenues, which account for the lion’s share of total revenues, is pegged at $620.1 million, indicating a decrease from the year-ago quarter’s $628.3 million.

However, site-development revenues are expected to improve in the first quarter. The consensus mark stands at $37.2 million, implying growth of 25.8% from the year-ago period.

The Zacks Consensus Estimate for total quarterly revenues is pegged at $657 million, indicating a year-over-year decline of 0.13%.

The company’s activities in the to-be-reported quarter were inadequate to garner analysts’ confidence. The Zacks Consensus Estimate for quarterly AFFO per share has been revised marginally southward to $3.12 over the past month. Moreover, the figure implies a year-over-year decline of 5.17%. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

What Our Quantitative Model Predicts for SBA Communications

Our proven model does not conclusively predict a surprise in terms of AFFO per share for SBA Communications this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an AFFO beat, which is not the case here.

SBA Communications currently has an Earnings ESP of -0.38% and a Zacks Rank of 3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks That Warrant a Look

Here are two stocks from the broader REIT sector — Ventas VTR and Host Hotels & Resorts HST — that you may want to consider, as our model shows that these have the right combination of elements to report a surprise this quarter.

Ventas, scheduled to report quarterly numbers on April 30, has an Earnings ESP of +0.18% and carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Host Hotels & Resorts is slated to report quarterly numbers on April 30. HST has an Earnings ESP of +1.13% and carries a Zacks Rank of 3 at present.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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Host Hotels & Resorts, Inc. (HST) : Free Stock Analysis Report

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SBA Communications Corporation (SBAC) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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