American Tower (AMT) just reported second quarter 2026 results that highlighted strong leasing at its CoreSite data centers and steady demand across its global tower portfolio, prompting management to raise full year revenue and profitability guidance.

American Tower's latest earnings and upgraded 2026 outlook have been met with a 1 day share price return of 4.52% and a 7 day gain of 7.95%. However, the 1 year total shareholder return is down 10.81%, suggesting short term momentum against a weaker longer term picture.

If this earnings driven move has you thinking about where else growth and infrastructure stories might emerge, it could be worth scanning the market via the 56 AI infrastructure stocks

After this sharp move, American Tower still trades at a sizeable implied discount to both analyst targets and an intrinsic value estimate. Is the market rightly cautious about towers and data centers, or is it mispricing a stronger earnings story?

Preferred P/E Multiple of 24.6x: Is It Justified?

Based on current data, American Tower trades on a P/E of 24.6x, which screens as good value relative to both its peers and an internal fair value reference.

The P/E multiple shows how much investors are paying for each dollar of American Tower's earnings. For a large global REIT with $10.9b of revenue and $3.4b of net income, this is a common reference point because earnings and cash generation are central to how many investors assess real estate focused companies.

Here, the 24.6x P/E sits below the North American Specialized REITs industry average of 29.8x and also below an estimated fair P/E of 34x. That combination signals a clear valuation gap to both sector pricing and a level the market could potentially move towards if earnings quality, profit growth and cash flow trends remain aligned with current expectations.

Result: Price-to-Earnings of 24.6x (UNDERVALUED)

However, investors still need to weigh risks such as weaker long term total returns for American Tower and any shift in demand for its tower and data center assets.

Another View Using the SWS DCF Model

While American Tower looks inexpensive on its 24.6x P/E, the SWS DCF model suggests an even larger gap. With the stock at $179.26 and an estimated future cash flow value of $288.04, this approach also points to undervaluation. Which signal do you trust more?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out American Tower for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 49 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Given the mix of signals around American Tower, it makes sense to look at the underlying data yourself and decide quickly where you stand. To weigh both the concerns and the upside case in one place, review the 6 key rewards and 1 important warning sign

Looking For More Ideas Beyond American Tower?

If American Tower's latest move has sharpened your focus, do not stop here. Use this moment to line up your next set of potential opportunities.

• Target resilient cash generators by scanning companies in the 49 high quality undervalued stocks that combine quality fundamentals with prices that may not fully reflect them.
• Strengthen your income stream by reviewing stocks in the 9 dividend fortresses that offer higher yields with an emphasis on consistency.
• Protect your downside by focusing on companies within the 85 resilient stocks with low risk scores that score well on balance sheet strength and overall risk.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.