American Tower (AMT) is positioned for a modest re-rating from decade-low valuation levels, supported by accelerating domestic leasing trends, Morgan Stanley said in a Thursday note.

The investment firm flagged that carrier consolidation, including EchoStar's (SATS) spectrum sales to incumbents, could delay densification spending and weigh on multiple expansion, but noted that current valuation already prices in some consolidation risk, providing a favorable risk/reward profile.

Morgan Stanley highlighted that US tower stocks underperformed the S&P 500 by roughly 25% in 2025, but revenue growth from a strong domestic leasing backlog and rising application activity should help drive organic leasing acceleration into 2026.

The firm also cited potential upside from new upper C-band spectrum expected to come to market in 2027.

Morgan Stanley lowered its price target on AMT to $225 from $235 while maintaining its overweight rating, noting that the company's core tower business remains attractively valued relative to peers.

Price: 177.40, Change: +1.22, Percent Change: +0.69