Status Quo for Crown Castle in Q2: Towers Look Good While Small Cells Lag

As Crown Castle’s second-quarter results reinforced, towers continue to be a phenomenal business for the firm—exhibiting continually strong organic growth while requiring negligible investment—while small cells remain a business that presents hope on the horizon rather than performing well today. Nothing in the quarter changed our skepticism that small cells will ever add value to Crown Castle, and we think key tower metrics are at peak levels, though we don’t project a material drop off in tower results. With little in the quarter to change our view, we are maintaining our $135 fair value estimate.