SBA Communications debt offering wins BBB- rating from Fitch

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SBA Communications BBB- debt offering

Highlights

Fitch assigned a BBB- rating to SBA Communications' new notes, citing global scale, high EBITDA margins, and refinancing of existing secured term loan and revolver.
Fitch projects SBA's net leverage at 6.6x for year-end 2024 and 6.7x for year-end 2025, with expectations to stay mid-to-high 6x through the forecast period.
Fitch expects low-single-digit long-term organic growth driven by rising wireless demand and 5G, with 90% of 2026 domestic leasing revenue anchored by T-Mobile, AT&T, and Verizon.

Refinancing plan and credit rationale

As reported by Fitch Ratings, the proposed notes will be used to refinance SBA Communications' existing senior secured term loan and revolver, while the agency says the company's scale as a global tower operator, high EBITDA margins and recurring contractual revenue support the BBB- rating.

Fitch says SBA's credit profile benefits from strong recurring cash flow from leasing operations, long-term contracts, stable pricing with annual low single-digit escalators and relatively low maintenance capital intensity. Those strengths are balanced by leverage that remains higher than that of some peers, but Fitch expects the company to keep net leverage below 7.0x over the rating horizon.

Under Fitch's calculations, net leverage stands at 6.7x at year-end 2025, compared with 6.6x at year-end 2024. The agency expects leverage to remain in the mid- to high-6x range through the forecast period, while SBA continues to adjust capital allocation between acquisitions, share repurchases and dividend growth.

Wireless demand and sector positioning

Demand growth in wireless data services is supporting the need for additional network capacity among major U.S. operators, and Fitch expects 5G, fixed wireless access and AI-related activity to support amendments and new lease-up revenue for SBA. The agency expects those trends to help drive at least low-single-digit long-term net organic growth, with domestic revenue also supported by SBA's recent global agreements with Verizon.

Tenant concentration remains anchored by large investment-grade carriers. As of March 31, 2026, about 90% of domestic site leasing revenue comes from T-Mobile, AT&T and Verizon, while more than 35% of international revenue comes from Telefonica and America Movil, together representing more than 70% of expected 2026 site leasing revenue. No single tenant accounts for more than 30% of total revenue, which Fitch says supports cash flow stability.

Fitch also says tenant churn appears manageable. SBA expects Sprint-related churn at about $55 million in 2026 before declining to $20 million thereafter, while EchoStar lease non-payment is expected to affect 2026 by roughly $55 million. The agency says continued leasing activity and contractual escalators should more than offset those pressures over time.

Within the sector, Fitch notes that American Tower and Crown Castle each operate more than twice as many U.S. towers as SBA and both carry lower leverage. Cellnex Telecom is rated at the same BBB- level, reflecting higher leverage than U.S.-based peers. Fitch says tower operators continue to benefit from high operating leverage, stable long-term contracts and predictable cash flows, which keep business risk relatively low across the industry.

Our earlier coverage of U.S. banks’ second-quarter fee growth highlighted expectations for a strong rebound in investment banking and trading revenues at major Wall Street firms. We noted that equity capital markets activity and elevated volatility were key drivers, while improving commercial lending and management commentary on how sustainable the momentum is remained central investor watchpoints.

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