TCW funds, an investment management company, released its “TCW Global Real Estate Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The fund (I Share) returned +2.37% in the quarter compared to +4.50% for the S&P Global REIT Index. The overweight allocation in Diversified Real Estate Activities had a favorable impact on the fund’s relative performance in the quarter, while the overweight in Telecom Tower REITs had a negative effect. In addition, please check the fund’s ...

Key Takeaways SBAC benefits from rising mobile data use as carriers invest heavily in network upgrades and expansion.SBA Communications relies on long-term tower leases, supporting stable revenues and high operating margins.SBAC expanded its portfolio with 447 sites acquired and 151 towers built, with more sites under contract.SBA Communications' (SBAC) portfolio is well-positioned to gain from wireless carriers’ high capital spending for network expansion amid growth in mobile data usage. The long-term lea ...

Core Insights - The article discusses the author's journey from politics to value investing, emphasizing a long-term investment strategy focused on risk management [1] Group 1: Career Transition - The author initially pursued a career in politics but shifted to finance after facing challenges in 2019, leading to a focus on making money work for them [1] - From 2020 to 2022, the author worked in a sales role at a law firm, where they became the top-grossing salesman and managed a team, contributing to sales strategy [1] - The experience gained during this period helped the author assess company prospects based on sales strategies [1] Group 2: Investment Advisory Experience - From 2022 to 2023, the author worked as an investment advisory representative with Fidelity, focusing on 401K planning [1] - The author excelled in this role, passing Series exams ahead of schedule, but felt frustrated with Fidelity's reliance on modern portfolio theory, which conflicted with their value investing approach [1] - After a year, the author decided to leave Fidelity due to the inability to change positions internally [1] Group 3: Current Endeavors - In November 2023, the author began writing for Seeking Alpha, sharing investment opportunities and insights with readers [1] - The author has been actively investing while building a base of capital through aggressive saving [1]

Core Insights - The article discusses the author's journey from politics to value investing, emphasizing a long-term investment strategy focused on risk management [1] - The author highlights the importance of sales strategy in assessing a company's prospects, particularly when the product has strong market appeal [1] - The transition from a sales role in a law firm to an investment advisory position at Fidelity illustrates the author's commitment to value investing despite challenges in aligning with modern portfolio theory [1] Group 1 - The author initially pursued a career in politics but shifted to value investing after recognizing the financial challenges in politics [1] - From 2020 to 2022, the author worked in a sales role at a law firm, where they became the top-grossing salesman and managed a team [1] - The experience gained during this period contributed to the author's ability to evaluate companies based on their sales strategies [1] Group 2 - The author worked as an investment advisory representative with Fidelity from 2022 to 2023, focusing on 401K planning [1] - Despite excelling in the role and passing Series exams ahead of schedule, the author felt frustrated with the modern portfolio theory approach at Fidelity [1] - The decision to leave Fidelity was driven by the desire to pursue value investing more aligned with personal investment philosophy [1] Group 3 - The author began writing for Seeking Alpha in November 2023 to share investment opportunities discovered through personal research [1] - The articles serve as a platform for the author to document and share the investment journey with readers [1] - The emphasis on aggressive saving and capital building reflects a proactive approach to personal finance and investment [1]

Company Overview - SBA Communications Corporation (SBAC) is valued at a market cap of $20.3 billion and is a leading independent owner and operator of wireless communications infrastructure [1] - The company primarily generates revenue by leasing antenna space on its extensive portfolio of cell towers, rooftops, small cells, and distributed antenna systems to major wireless carriers under long-term contracts [1] Market Position - SBAC is classified as a "large-cap stock" due to its market cap exceeding $10 billion, highlighting its size, influence, and dominance within the REIT - specialty industry [2] - The company benefits from steady demand for mobile connectivity and network densification driven by 5G, positioning it as a critical enabler of global wireless network expansion [2] Stock Performance - SBAC has slipped 22.8% below its 52-week high of $245.16, reached on May 6, and shares have declined 1.1% over the past three months, underperforming the S&P 500 Index's 5% rise during the same period [3] - Over the past 52 weeks, SBAC has fallen 15.2%, lagging behind the S&P 500's 13% uptick, and on a year-to-date basis, shares are down 7.1%, compared to the S&P 500's 16.3% return [4] Financial Performance - SBAC posted better-than-expected Q3 earnings results on November 3, with total revenue improving 9.7% year-over-year to $732.3 million, surpassing consensus estimates by 3.9% [5] - Higher site leasing and site development revenues contributed to the topline rise, while AFFO per share declined marginally to $3.30, exceeding analyst expectations of $3.19 [5]

Core Insights - The company is focused on creating long-term shareholder value through top-line growth and effective capital allocation [2] Group 1: Top-Line Growth - The company has signed a new Master Lease Agreement (MLA) with Verizon, which is a 10-year transaction aimed at facilitating faster equipment deployment for coverage and densification [3] - This partnership is expected to secure a minimum growth rate for the company, indicating a positive outlook for revenue generation [3] Group 2: Capital Allocation - The company anticipates approximately $1.9 billion in EBITDA, with specific allocations including $475 million for dividends, $435 million for cash interest expenses, $35 million for cash taxes, $50 million in maintenance CapEx, and $200 million in growth CapEx [3] - After these allocations, the company expects to have about $700 million available for further capital initiatives [3]

Summary of SBA Communications Conference Call Company Overview - **Company**: SBA Communications (NasdaqGS:SBAC) - **Industry**: Telecommunications Infrastructure Key Points Strategic Focus - The company aims to create long-term shareholder value through top-line growth and effective capital allocation [4][8] - A new Master Lease Agreement (MLA) with Verizon was signed, which is expected to facilitate faster equipment deployment and secure minimum growth rates [4][35] Financial Overview - Projected EBITDA is approximately $1.9 billion, with capital allocation including: - $475 million for dividends - $435 million for cash interest expenses - $35 million for cash taxes - $50 million in maintenance CapEx - $200 million in gross CapEx - Approximately $700 million available for deployment [5][70] - In 2023, $600 million of debt was paid down, and $100 million was allocated for M&A activities [6] M&A and Share Buybacks - The company executed a $1 billion deal with Millicom, which is expected to generate value [6] - As of October, $325 million was spent on share buybacks, indicating confidence in the stock's value [6][70] Market Dynamics - Exposure to DISH is limited, with a total potential revenue of $110 million and minimal short-term contributions [10] - The company anticipates continued activity in the 5G cycle, with major carriers like T-Mobile, Verizon, and AT&T at varying deployment stages [12][13] - CapEx as a percentage of revenue for major operators is currently at a low of 14.5%, historically fluctuating between 15% and over 20% [12] Challenges and Headwinds - Three main headwinds identified: 1. Rising interest rates affecting refinancing costs [22] 2. Churn due to market consolidation, particularly with Sprint and Oi [22] 3. Short-term challenges in growth, but long-term outlook remains positive [23] Regional Insights - **Latin America**: The Millicom deal is expected to contribute to stable growth, with a focus on Brazil despite short-term challenges due to high interest rates and market churn [49][52] - **Africa**: Positive growth in Tanzania with plans to build nearly 200 sites, while South Africa remains a strong market [57] Future Outlook - Long-term growth is expected to be driven by increased wireless usage and the ongoing shift towards fixed wireless access [21][70] - The company is focused on maintaining a strong U.S.-denominated revenue mix and is cautious about entering new markets due to high taxes and consolidation risks in Europe [60][61] Investment Grade Status - The company has been upgraded to investment grade, which is expected to lower the cost of capital and improve financing options [68] Conclusion - The company remains optimistic about the long-term prospects of the tower industry, emphasizing the unique value of its infrastructure and the ongoing demand for wireless services [71]

Core Viewpoint - SBA Communications reported a mixed performance in its recent earnings, with adjusted funds from operations (AFFO) per share beating estimates but showing a decline compared to the previous year. The company experienced revenue growth, but higher costs and interest expenses impacted overall performance [3][4]. Financial Performance - The third-quarter 2025 adjusted funds from operations (AFFO) per share was $3.30, exceeding the Zacks Consensus Estimate of $3.19, but down from $3.32 in the prior-year period [3]. - Total quarterly revenues increased by 10% year over year to $732.3 million, surpassing the Zacks Consensus Estimate of $705.1 million [4]. - Site-leasing revenues rose by 4.9% year over year to $656.4 million, with domestic site-leasing revenues at $470.3 million (up 1.5%) and international site-leasing revenues at $186.2 million (up 14.4%) [5]. - The site-leasing operating profit was $529.1 million, a 4.2% increase year over year, contributing 97.5% to total operating profit [6]. - Adjusted EBITDA totaled $493.3 million, reflecting a 4.4% increase, while the adjusted EBITDA margin decreased to 67.5% from 70.9% in the prior-year quarter [7]. Portfolio Activity - In Q3, SBA Communications acquired 447 communication sites for $142.8 million and built 151 towers, bringing the total to 44,581 communication sites as of September 30, 2025 [8]. - The company spent $8.9 million on land and easements, with total cash capital expenditure at $71.9 million [9]. - Following the quarter-end, SBA Communications closed on the acquisition of 2,020 sites related to the Millicom transaction for $217.4 million [10]. Cash Flow & Liquidity - As of September 30, 2025, SBA Communications had $0.5 billion in cash and cash equivalents, up from $0.3 billion as of June 30, 2025 [12]. - The company ended the quarter with $12.3 billion in net debt, resulting in a net debt-to-annualized adjusted EBITDA ratio of 6.2X [12]. - During Q3, SBA Communications generated nearly $318 million of net cash from operating activities, compared to $304.7 million in the year-ago quarter [14]. 2025 Guidance - SBA Communications expects AFFO per share in the range of $12.76-$12.98, adjusted EBITDA between $1,909-$1,919 million, and site-leasing revenues projected between $2,568 and $2,578 million [15].

Group 1 - The service business is experiencing strong site development activity driven by a specific carrier's coverage requirements that need to be met by Q2 2026 [1] - Lease-up activity has shown an increase, with $9 million in the first quarter, $8 million in the second quarter, and $10 million in the third quarter [1] - There has been a significant wave of capital expenditures (CapEx) in the wireless sector during 2022 and 2023, indicating positive trends in the industry [2]

Summary of SBA Communications Conference Call Company Overview - **Company**: SBA Communications (NasdaqGS:SBAC) - **Industry**: Telecommunications Infrastructure Key Points Site Development and Growth Drivers - Strong site development driven by a major carrier's coverage requirements due by Q2 2026, leading to increased activity in site rollouts [3][4] - Lease-up activity showed a positive trend with $9 million in Q1, $8 million in Q2, and $10 million in Q3 [3] - Significant capital expenditure (CapEx) in 2022 and 2023 for 5G rollout, resulting in a 10x increase in capacity [3] Fixed Wireless Access (FWA) Impact - FWA users consume 20-25 times more capacity than traditional handset users, with over 10 million new FWA customers expected this year [5] - The expansion of FWA is beneficial for SBA as it increases demand for tower space [5] Rural Market Expansion - Carriers are expanding into rural markets, potentially driven by FWA and competition from new entrants like SpaceX [7][8] - SpaceX's investment in spectrum and low Earth orbit (LEO) technology may enhance coverage and competition in rural areas [7][8] Long-term Agreements (MLAs) with Carriers - SBA has signed MLAs with Verizon and AT&T, providing volume commitments in exchange for better pricing and predictable growth rates [14][16] - These agreements facilitate faster capacity and coverage expansion for carriers [17] Exposure to DISH Network - SBA's exposure to DISH is approximately $55 million annually, with minimal lease-up expected in 2025 and zero in 2026 [18][20] - The total exposure on the contract is $110 million, but current lease payments are being met [18] International Expansion - SBA has become the largest tower operator in Central America following the acquisition of Millicom towers [21][23] - The deal includes a 15-year lease with growth potential in a market with low 5G deployment [23] Growth Outlook - U.S. organic revenue growth is projected at mid-single digits, with Central America expected to see mid to high single-digit growth [33] - Brazil is viewed as a long-term growth market despite short-term churn [27][28] EBITDA Margin and Profitability - Current EBITDA margin is around 68%, with potential for further enhancement through service business growth and lease-up activities [34] - The Central American business is expected to improve margins as lease-up activities increase [34] Capital Structure and Investment Grade Status - SBA aims to transition to an investment-grade issuer, having operated below seven turns of leverage for three years [41][42] - The company plans to refinance existing ABS and issue investment-grade debt to improve its capital structure [44] Shareholder Returns and Capital Allocation - SBA has generated approximately $700 million in excess cash annually after dividends and expenses, which can be used for share buybacks, debt repayment, or M&A [47][48] - The company plans to continue increasing dividends at a double-digit growth rate while also considering share buybacks [48] Industry Outlook - The tower industry is expected to face short-term headwinds from rising interest rates, Sprint churn, and CapEx cycles, but long-term prospects remain positive [50][51] - Anticipated future developments include the rollout of 6G technology and continued demand for wireless infrastructure [51] Additional Insights - The competitive landscape in Europe is challenging due to market consolidation, making it difficult for public companies to engage in M&A without facing churn [30][31] - SBA is cautious about pursuing M&A in emerging markets but remains optimistic about its current position in Central America and Brazil [27][28]