Wells Fargo analysts slice and dice U.S. tower activity

The analysts at Wells Fargo recently hosted an investor meeting with Vertical Bridge CEO Alex Gellman, and they said, “We came away encouraged by the U.S. macro leasing outlook, even with a few near-term uncertainties.”

They noted that both T-Mobile and Verizon have been very active with amendments for 2.5 GHz and C-band, respectively, and AT&T has started to turn a corner on new leasing.

In terms of Verizon’s C-band deployments, Wells Fargo projects more than 20,000 site overlays in 2022. And it thinks T-Mobile “is well on track to upgrade about 55,000 sites by 2023, with more likely to come as it expands distribution of both mobile and fixed wireless offerings to rural America.”

For AT&T, it sees the carrier modestly slowing its tower deployments as it awaits dual-band radios for joint C-Band/3.45 GHz upgrades. It expects activity to pick up more in 2023 as AT&T more broadly deploys its one-tower climb strategy.

AT&T’s CEO John Stankey said as much on the company’s first quarter 2022 earnings call. Asked about its C-band rollout, Stankey said AT&T is gearing up for that right now. It wants to have all the necessary equipment before it starts climbing towers later this year.


Gellman told Wells Fargo that Dish, which had been very strong out of the gate with new colocations in 2021, has recently slowed activity as it prioritizes markets to meet its 20% coverage requirement by June 2022.

“The pace of Dish bookings remains key to the SBAC story, who we believe has won an outsized share of early deals,” wrote the analysts. Gellman suspects Dish will only hit about 15,000 sites by 2023, but there will be a big push in 2024 and 2025.

Interestingly, Wells Fargo said, “While Dish has publicly talked about hitting a 70% coverage goal by 2023, the reality is that they only need to hit a 50% threshold by June 2023 (not 70%), with the 70% requirement extended out to June 2025 to cover full economic areas.”

This extended timeline gives some wiggle-room for Dish and less certainty about yearly profits for the tower companies.

Wells Fargo thinks that of the three big public tower companies, SBA Communications will see the most benefit from all the near-term tower activity in the U.S.

According to the analysts, T-Mobile is maintaining a long-term goal of 85,000 macro sites. AT&T and Verizon each have about 70,000 macro sites today and will probably need to match T-Mobile’s level to reach nationwide coverage of their mid-band spectrum.

Many of the build-to-suit tower agreements are going to private tower operators like Vertical Bridge.