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American Tower Corporation

Introduction:

American Tower Corporation, headquartered in Boston Massachusetts, is a wireless communications real estate Company which functions as an independent owner, operator, and developer of wireless communications infrastructure. ACT products include wireless and broadcast towers, in-dash building and outdoor distributed antenna system (DAS), other right-of-way options, small cell and Wi-Fi networks, managed rooftops and services that speed network deployment for the wireless and broadcast communications industry (American Tower Corporation). The company was formed in 1995, originally as a subsidiary of American Radio Systems, the United States fifth largest radio broadcasting company in 1997. When American Radio Systems was acquired by CBS in 1998, American Towers Corporation became its own entity. By 1999, the company expanded its operations into Mexico. Presently American Towers Corporation offers solutions and services to deploy and support wireless networks in about 13 countries in five continents.

Employment opportunity:

American tower corporation (ACT) has been able to offer employment to many people worldwide. The key employees were sixteen headed by James D. Taiclet Jr, as the chairman, the chief executive officer as well as the president of the company since 2004 to date with his vice president Amit Sharma. All these employees ensure that the company runs smoothly, and growth is also achieved in the institution (Brubacher, 2017). This company has been able to offer a number of services where the key services include construction, backup power, small cell solutions, redevelopment, rooftop locations, distributed antenna system (DAS) solutions among others.

Mission:

The company major objective is to lead in the wireless connectivity around the world. It aims to beat competing firms and be the top company in wireless connections. Guiding efficiency throughout the industry is also another mission where operations will be made easier. Customers are the main aim of the company and the company has a mission of growing the assets and capabilities to meet the customer needs. There is also a mission to innovate for a mobile future wherein future communications will be made easier all over the world.

Vision and Values:

American Tower Corporation vision is to make wireless communication possible everywhere. This will help in driving the company ahead since it has set a target to accomplish in the future. The company has massive value to understand customer's needs and satisfy them accordingly. Quality skills are required in order to satisfy the customers effectively and the company does hire competent employees and educate them on what to do while carrying out different activities. The company also values on focusing on the solutions, not problems. American Tower Corporation puts integrity first and enhances teamwork in order to exceed expectations.

Operational Risks:

American Tower Corporation affords people several ways to connect to wireless. They take on many operational risks that influence their daily operations and the communications industry as well. The advantage of having many towers in several different countries, it is the company's responsibility to make sure the towers are functioning properly. This means that the towers would have to be monitor and maintain regularly all year round to avoid breakdown in every operational zone around the world. The company has Insurance policies in case of accident or natural disaster.

Strategic Risks:

I believe, the most substantial risk American Tower Corporation should address is the increase in competitive pressure on their core market. For instance, Google has been developing "high altitude platforms" which are basically blimps that transmit wireless signals (Bodkin, 2013). This type of technology is less invasive on the environment and can be moved at will between different locations. Moreover, the platforms signal can be broadcasted over hundreds of square miles so Google could use this technology in almost every part of the world. The issue with Facebook creating a solar powered plane called Aquila that can provide Internet to users below (Snyder, 2015). This plane is an even larger threat to ATC's strategy because not only is it highly mobile, but it can stay in the air for months at a time and is most likely more weather resistant than Google's blimps. These instances of competitive pressure pose huge threats to ATC because their whole business strategy relies on stationary radio towers, and if other companies develop technology that is more eco-friendly, mobile, and easy to set up, then they are going to have to rethink their business strategy.

New current business strategies are being developed to enhance the company new business opportunities from different countries worldwide. New skilled workers are being employed by the firm to improve the company (Ferran, 2014). Legal advisers are deployed by the company where they are being used to cover the business future events and help in advising accordingly which helps in reducing risks in the business. New business strategies need to be developed because they aid in the growth of the business and they are very instrumental in the growth of the business.

Stakeholders

The stakeholders of this company are as follows;

Stakeholder Stake

1. Vanguard REIT index fund 5.04%

2. Akre focus fund. 1.40%

3.Columbia management investment company 1.60%

4. Akre capital management LLC 1.60%

Financial Risks:

American Tower Corporation's financial risks are less substantial than most companies; however, there are a few significant concerns. The biggest financial risk would be construction delay which causes the biggest concern mainly due to the fact that the sectors of the risk is entirely out of their control.

Another concern for the company's finances, specifically in recent years, is currency risk. Currency risk can become an issue when companies work in foreign nations. Exchange rates fluctuate continuously, and with American Tower's recent growth, currency risk can affect its finances. American Tower has recently acquired over 6,000 sites internationally, which now includes 13 countries including the US (Stearns 2015). Among these countries, there are several different currencies with fluctuating economies. For the most part,

the company has made tremendous profits from the deals it continues to engage in. In the past three years, profits have been ripped from the deals that have been made with other companies. In 2015, the company made one volume deal where the deal made 5,053 US million dollars. In the year 2016, the company was able to make two deals and they result in making 1,953 US million dollars which were a prove of growth for the company. The following year, which was 2017, three deals were made by the company and a profit of 772 US million dollars was made. The company has an encouraging financial history wherein the fiscal year of 2017 which ended on the December of the same year the company reported revenues of US$6,663.9 million which was an increase of 15.2% over the 2016 fiscal year. The operating margin of the company was 28.9% in the year 2017 compared to the operating margin of 32% in the 2016 fiscal year. A net margin of 18.6% was recorded by the company in the 2017 fiscal year and in the year 2016 the net margin was 16.5%. The company then reported US$1,780.9 million as the amount of revenue that was collected in the second quarter, that quarter was completed in June 2018 and this was an increase of 2.2% over the previous quarter.

Debt:

American Tower Corporation has not faced difficult financial situations, so it has not borrowed much money from other sources. However, in the year 2003 American Tower Corporation divested its wholly owned subsidiary; Verestar went on and filled a bankruptcy file with an aim of protection under chapter 11 of the federal bankruptcy laws 2003. The leverage ratio indicating the relative proportion of the equity of the shareholders and the debt used to finance this cooperate assets was low hence the risk was also low; because the debt holders would claim less from the company assets hence the Debt to equity ratio was favorable (Markham, 2015). A significant increase in the company's debt levels was reported to increase. This company debt liability increased at a compounded annual growth rate of 7.8% during 2013-2017. As a result of this indebtedness, these company large portions of cash flow will be used in order to pay the indebtedness service which will further affect the overall liquidity position.

Patents and legal issues:

This company is license by the relevant authority which permits it to operate in the specific countries. Communication service license should also be acquired so that the company can avoid facing legal issues for practicing unfairly in the market field. This company is also facing a number of legal issues which had led to the recruitment of a number of legal advisers. Similar companies have arraigned the company for issues to do with market competition. The company has been sued for gaining an unfair market advantage. Tax evasion is one of the legal issues that the company has been reported for. In the countries in which the company has invested in are always in the lookout so that the company carries its activities accordingly. Different corporations have also reported the company for gaining the communication rights unfairly which is against the law. Dissatisfied customers have also filed cases against the company where they have claimed that the services that they had paid for were rendered correctly.

Strengths:

Strengths are the main supporting factors of a business; this company has strong financial performances where revenues have increased over the course of years. The company offers wide of services to its clients where all client's need can be catered for. This is necessitated by employing f skilled personnel to carry out the activities. The scalable asset base with low maintenance requirements has been beneficial to the company because it facilitates in high operating leverage since the incremental operating costs are minimal.

Weaknesses:

As a weakness, the company is experiencing a high level of indebtedness and a lot of money is now sourced to cover the debts. These debts have cost the company a lot where it is unable to focus on new developments so that It can hit its targets over the course of time. in time, if the company will be able to settle all the debts new developments will be made but currently indebtedness in hindering company's growth.

Opportunities:

New opportunities are now emerging where there is a rising of the installed base of connected devices around the world. An increase of the investments by the wireless service providers in network infrastructure has helped the company a lot since it can access new investment areas. As new markets are emerging the company is being able to focus on those new markets and make decisions on which areas are suitable for investments to be done.

Threats:

Competition in the market has been a threat to the company since more resources need to be directed in advertisement of product in the company to manage their position. New technologies have merged, and they might impact the demand of the company since easier and cheaper means of communication are being invented year after year. The government changes have been a threat to the firm since if new governance get into power the introduce new policies and tax regulation programs.