With a market cap of $42.6 billion, Houston-based Crown Castle Inc. (CCI) is a leading real estate investment trust specializing in cell towers and fiber networks. The company owns, operates, and leases over 40,000 cell towers and 90,000 route miles of fiber, primarily supporting small cell networks and fiber solutions.

Shares of the telecom infrastructure REIT have significantly underperformed the broader market over the past 52 weeks. CCI has declined 11.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 28.9%. In 2024, shares of CCI are down 14.8%, compared to SPX's 11.2% gains on a YTD basis.

Zooming in further, CCI is also lagging behind the U.S. Digital Infrastructure And Real Estate ETF's (IDGT) 7.5% gains over the past 52 weeks.

CCI’s relative underperformance over the past year is primarily due to sluggish demand for wireless communication equipment, sector rotation impacted by high interest rates, slower growth expectations, and the inability of new small cell antennae nodes to sufficiently boost earnings amid struggling tower performance.

However, the company drew investors’ attention following its Q1 earnings results reported on April 17, with its shares surging nearly 1.4% on the subsequent trading session. The optimistic investor sentiment was ignited by the company's impressive top-line and bottom-line performance, surpassing forecasts.

For the current fiscal year, ending in December, analysts expect CCI's EPS to decline by 12.9% to $6.58. However, the company's earnings surprise history is promising. It beat the consensus estimates in each of the last four quarters. 

Among the 17 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on four “Strong Buy” ratings, one “Moderate Buy,” and 12 “Holds.”

This configuration is slightly less bullish than two months before, with five analysts suggesting a "Strong Buy."

On May 7, RBC Capital analyst Jonathan Atkin maintained a "Sector Perform" rating on Crown Castle and lowered the price target to $100. That implies a potential upside of just 1.9% from the current price levels.

The mean price target of $111.75 represents a premium of 13.9% to CCI's current levels. The Street-high price target of $132 suggests a potential upside of 34.5% from the current price levels.

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On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.