Crown Castle Inc. (NYSE:CCI) shares are gaining Thursday on reports that SpaceX is negotiating tower leases with the company as it hunts for at least 80,000 U.S. cell sites.
- Crown Castle shares are powering higher. Why is CCI stock surging?
Crown Castle Stock Rises On SpaceX Lease Talks
SpaceX Exploration Technologies Corp. (NASDAQ:SPCX) is working to secure 80,000 or more cell sites nationwide, and Crown Castle sits among the tower companies at the table, people familiar with the matter told Bloomberg.
In late trading, Crown Castle stock rose double digits after the news broke. Wireless carriers AT&T, Verizon and T-Mobile moved the other way, each down roughly 5% on competition worries.
CEO Chris Hillabrant did not confirm any agreement during Wednesday’s earnings call. Pressed on whether SpaceX, Amazon.com Inc or other satellite providers are negotiating leases, Hillabrant replied, “You can assume that we’re talking to all parties.” He would not name specific customers.
Why SpaceX Talks Help Crown Castle
Crown Castle is one of the largest owners of cellular towers. Wireless carriers typically lease space on those towers instead of owning the sites. SpaceX needs towers to connect reliably with users on the ground, so it could become a major new tenant. Deals of that scale may be worth billions of dollars.
Tower stocks also reacted to SpaceX news earlier this month. They rose when SpaceX bought low-band spectrum, which suggests the market expects new business as SpaceX builds out its network.
SpaceX Pushes Toward a Fourth Wireless Carrier
SpaceX CEO Elon Musk has set his sights on a standalone wireless carrier built from nothing. Two recent moves back that plan: low-band spectrum SpaceX bought, and Federal Communications Commission approval to launch 15,000 satellites that serve phones directly.
Hillabrant said the spectrum deal marks a big step toward broad mobile coverage.
CCI Shares Are Soaring
CCI Price Action: Crown Castle shares were up 9.44% at $86.27 at the time of publication on Friday, according to Benzinga Pro.
Image: JHVE Photo/Shutterstock