The company faces interest rate risk from variable-rate debt and refinancing. Fluctuations in foreign currency exchange rates, particularly the Brazilian Real, pose a risk to revenue and operating income. Intercompany loans denominated in foreign currencies create unrealized gains/losses from exchange rate changes. The company's ability to successfully manage acquisitions, including due diligence, integration, and regulatory approvals, is a risk. High inflation could negatively impact revenue growth due to fixed pricing in some contracts. Contingent liabilities from pending acquisitions and tax assessments are also risks.
Financial Upside
Long-term lease contracts with escalators provide stable recurring revenue. The company anticipates organic site leasing revenue growth, driven by carrier deployments. Acquisitions and new tower construction are expected to increase the asset portfolio. The company's capital allocation strategy includes stock repurchases and dividends, potentially increasing shareholder value. The revised tower useful life estimate leads to lower depreciation and amortization expense.
