TRADE ALERT - Core Portfolio September 2025

Dear Landlords,

I want to extend a warm welcome to all our new members!

As a reminder, our most recent "Portfolio Review" was shared with the members of High Yield Landlord on July 7th, 2025. You can read it by clicking here.

You can also access our three portfolios on Google Sheets:

New members can start researching positions marked as Strong Buy and Buy while considering the corresponding risk ratings.

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TRADE ALERT - Core Portfolio September 2025

I think that today's trade alert is a good example of how active investors can potentially add alpha to their portfolio by closely monitoring their positions.

All cell tower REITs (SBAC; CCI; AMT) sold off over the past few weeks following the announcement that AT&T (T) would acquire spectrum licenses from EchoStar (SATS). Such tenant consolidation events have historically led to lease cancellations, hurting the growth of cell tower REITs.

Data by YCharts

But here's the thing: SBA Communications's stock dropped by 13%, even as EchoStar (Dish) is just 2% of its revenue. Moreover, it is not even clear whether it will lose all of this 2% and when, as leases typically run over many years. So yes, it is a headwind and will lead to increased churn, but it is not a significant event that warrants such a steep sell-off in my opinion.

I think that the other positive news from its Q2 results and lower interest rates are more important.

The company just hiked its 2025 guidance across all metrics after noting an acceleration in its organic growth. The management specifically pointed out that their US business (which is where those EchoStar assets are located) is performing even better than expected:

"In the U.S., activity levels continue to improve, and this quarter represents the sixth sequential quarter where bookings increased. While not at the peak levels enjoyed back in '21 and '22, positive momentum continues to build, and we are encouraged by the sustained levels of activity as carriers continue investing in their wireless networks.

The backlog also remains healthy which bodes well for the remainder of the year and into 2026. Consistent with our strong U.S. bookings, our services business outperformed our expectations and we are increasing our full year services revenue guidance by almost 20%. Most of the increase is related to construction services as carrier installations accelerate across the U.S. I am optimistic about domestic organic growth opportunities over the next year or 2 due to the specific initiatives of each of our major customers, but I am also optimistic about the long term." Brendan Thomas Cavanagh, CEO of SBA Communications [emphasis added]

Dgtl Infra

I think that this is at least partly due to the growing number of AI-intensive applications (ChatGPT, autonomous vehicles, humanoid robots, smart cities, cloud AI services), which will drive massive increases in data usage over time. More data traffic will require a greater need for wireless infrastructure, and SBA's major tenants know this.

And this is not the only positive news.