This has the cell towers and fiber-optic networks that are going through all US cities. He is more attracted to the bonds than to the stocks, because it is a highly leveraged company. They are on the edge of investment grade, so a downturn could hurt. Demand for speed and 5G is coming and is going to be an opportunity. If you want to go into a company like this, the volatility is going to be very high, so you only want to go in with a half position, and manage it over time.

Basically cell phone towers sit on top of buildings and in the middle of fields, etc. When this was initially listed, it had a huge run and the market actually processed it as a REIT. With a rising yield, the valuation climbed, and the stock continued having a huge run. At these levels, the argument would be how much more money can you squeeze out of them. Start thinking about companies that spin the tower businesses out. The business is a very good business. Telcos have to pay them. Without them, you can't run a telco network. He wouldn't buy at these levels.

A bit of a complicated valuation exercise when you look at it, because it looks expensive on a price/earnings ratio, but really is not. It’s treated more like a real estate investment trust. The street looks at it on an adjusted funds from operations standpoint. When you look at it that way, it compares reasonably well against its major competitors. Growing very well internationally, but stumbling a little domestically. If you take a position, do it as part of a balanced portfolio. He wouldn’t put a lot of risk capital into it.

American Tower (AMT-N), Crown Castle International (CCI-N) or SBA Communications (SBAC-Q)? US REITs that own cell towers. You want to own these because they have multiple tenants. The average tower has 3 or 4 tenants. They can put more and more gear on them, so there is lots of room to grow revenues. The US is going through a boom on bandwidth, certainly wireless spectrum. Of the 3, he prefers this, the most international of the group. About 60% of revenue comes from the US and the rest is international. Generates a lot of free cash flow, and is highly predictable because of 5 year contracts. As we move to 5G, there is going to be a whole bunch more gear getting loaded on these towers, allowing them to charge more rent. It doesn’t pay a big dividend, but it has grown 34% a year over the last 5 years.

A REIT which owns cell phone towers all over the world. Cell phone towers are pretty interesting REITs as they have almost unlimited capacity. They have all the major wireless providers as customers, putting their gear up on their towers. Every time there is a new generation of gear, they don’t take the old stuff off, but put the new one on, so rents keep going up. They’ve done a great job of growing geographically. Has a broad customer base and isn’t levered to any one mobility provider. Over the next couple of years, we are going to start seeing 5G LTE coming, the next generation of wireless gear. They’ll continue to grow their dividend.

He really likes this because it is globally focused. It is the largest tower company in the US. These are literally wireless towers, and have long-term agreements with telecommunication companies in the US and globally. Any time there is a migration to a new higher speed technology, effectively the telco has to pay to upgrade all the equipment on the tower. A very visible and predictable business. If you think of data traffic tripling or quadrupling over the next 4-5 years, this is a company that is really going to benefit. This has great long-term growth potential.