Inwit Earnings: Steady Performance With Double-Digit Growth; Shares Undervalued

Inwit reported a steady fourth quarter with 12.1% organic revenue growth. Inwit deployed 4,200 new points of presence and only 905 new towers in 2023, resulting in an expansion in tenancy ratios from 2.16 tenants per tower one year ago to 2.23 today. Operating leverage keeps flowing to the EBITDA after leases profit line, which grew by 13.4% in the quarter, with margins expanding 80 basis points year on year to 72.3%. New services revenue for indoor cells, which are used to boost wireless signals in indoor spaces, keeps growing strongly, up 90% year on year, although it only represents 5% of the group’s revenue. We maintain our EUR 12.60 fair value estimate and see 20% upside for the shares at this point. Investors in Inwit get exposure to a company with double-digit revenue growth, healthy tenancy ratios and market dynamics, high EBITDAal margins, and growing dividends. Management will pay a EUR 0.48 dividend per share this May and expects an increase to EUR 0.52 in 2025 and EUR 0.60 in 2026. Inwit’s net debt/EBITDAaL ratio was 4.4 times this quarter as the company keeps deleveraging its balance sheet, thanks to EBITDAaL growth.