SBA's Expansion in Central America Should Add Value

SBA Communications has been more cautious than its tower peers in pursuing acquisitions and investing in its business, helping it avoid overpaying for assets and generating somewhat stronger returns on capital. However, it has repurchased shares more aggressively, often at inflated prices. With tower shares now trading at attractive valuations, we think repurchases will add value for shareholders. In addition, we think SBA's deal to acquire towers from Millicom and build new sites for the carrier in Latin America will generate solid growth and returns in the coming years.