Key Takeaways
- Crown Castle (CCI) stock surged 31% from October 2 to November 2, closing at $87.03 as SpaceX (SPCX) pursued wireless spectrum and potential tower leases.
- American Tower (AMT) could benefit from SpaceX’s reported plans to access at least 80,000 U.S. cell sites.
- Verizon Communications (VZ), AT&T, and T-Mobile could face additional wireless competition, while tower owners may gain a new customer.
- Crown Castle traded at approximately 17.8x forward AFFO in late October, below its five-year average of 18.5x, while Wall Street’s $93.50 average target implied about 7% upside from November 2.
What Happened?
Crown Castle (CCI) stock surged 31% from October 2 to November 2, climbing from $66.44 to $87.03 as SpaceX’s wireless expansion plans fueled expectations of additional tower leasing revenue.
On October 8, SpaceX agreed to acquire Grain Management’s nationwide 800 MHz spectrum portfolio in a transaction reportedly valued at approximately $8 billion.
On October 22, Bloomberg reported that SpaceX was discussing infrastructure agreements with Crown Castle while seeking access to at least 80,000 U.S. cell sites.
Spectrum ownership alone cannot provide nationwide terrestrial wireless coverage. SpaceX would need substantial infrastructure, creating potential leasing opportunities for established tower operators.
During Crown Castle’s October 21 earnings call, CEO Chris Hillabrant addressed potential leasing arrangements with SpaceX and other providers.
“You can assume that we’re talking to all parties,” Hillabrant said.
Although Hillabrant did not confirm a SpaceX agreement, his comments suggested Crown Castle could pursue additional leasing opportunities as SpaceX develops its network.
Crown Castle’s Earnings Show Signs of Stabilization
Crown Castle’s third-quarter results showed stronger profitability despite continued rental revenue pressure.
Adjusted funds from operations (AFFO) increased 11% to $1.24 per share from $1.12 a year earlier, exceeding the $1.20 consensus estimate cited in the research brief.
However, site rental revenue declined approximately 5% to $966 million from $1.01 billion, with $61 million in DISH terminations and $5 million in Sprint cancellations weighing on organic site rental billings.
Management expects 2026 to mark the low point for organic growth, while its updated full-year AFFO guidance of $4.60 per share at the midpoint suggests continued profitability despite leasing headwinds.
TIKR’s October 27 consensus estimates project revenue of $4.03 billion in 2026, $4.10 billion in 2027, and $4.19 billion in 2028.
These forecasts suggest gradual stabilization, while a substantial SpaceX agreement could provide additional revenue growth depending on contract terms.
SpaceX Could Create New Demand for Tower Operators
Crown Castle operates approximately 40,000 U.S. towers and other structures, while SpaceX is reportedly seeking access to at least 80,000 cell sites.
That suggests SpaceX could require multiple infrastructure partners, potentially benefiting American Tower, which raised its 2026 financial outlook following third-quarter results.
For Verizon, AT&T, and T-Mobile, SpaceX’s expansion could introduce another competitor in the U.S. wireless market.
Crown Castle, however, could benefit from additional leasing demand regardless of which wireless provider gains subscribers.
Still, no SpaceX lease has been confirmed, and the spectrum acquisition remains subject to regulatory approval.
Is Crown Castle Stock Undervalued or Overvalued?
As of October 30, Crown Castle traded at approximately 17.8x forward AFFO, slightly below its five-year average of 18.5x and well below its December 2021 peak near 29x.
Crown Castle appears fairly valued with potential upside, as its modest valuation discount must be balanced against relatively slow near-term revenue growth.
Wall Street’s average analyst price target of approximately $93.50 implied about 7% upside from its November 2 closing price, suggesting much of the anticipated recovery was already reflected in the shares.
Over the next 12 months, improving leasing activity, operating efficiencies, and a potential SpaceX agreement could support stronger AFFO and an improved valuation.
However, net debt of approximately 6.5x trailing EBITDA as of early October, customer cancellations, regulatory uncertainty, and the absence of a confirmed SpaceX contract remain important risks.
Further gains will likely depend on turning potential leasing opportunities into signed contracts and sustained earnings growth.
So what is Crown Castle stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
