Valued at a market cap of $63.1 billion, Public Storage (PSA) is the leading entity in the self-storage industry. The Glendale, California-based company specializes in acquiring, developing, and managing storage facilities for both personal and business use and also engages in tenant reinsurance and third-party management services.
Companies valued at $10 billion or more are generally considered “large-cap” stocks, and Public Storage fits this criterion perfectly, exceeding the mark. Public Storage distinguishes itself with its expansive network of over 2,200 self-storage locations across the US, Canada, and Europe, and its strategic position as a leading REIT with a notable stake in Shurgard Storage Centers.
However, the self-storage operator has dipped marginally from its 52-week high of $361.23 reached on Sep. 10. Despite this decline, shares of PSA have gained 30.9% over the past three months, outpacing the broader S&P 500 Index's ($SPX) 3.3% rise during the same period.
Longer term, Public Storage's shares have surged 29.9% over the past 52 weeks, outperforming SPX's 23.8% return in the same period. On a YTD basis, PSA’s 17.8% gain compared to SPX's 16.4% rise.
Since June, PSA has been trading above its 50-day and 200-day moving averages, signaling a bullish trend.
Public Storage has outperformed due to its strategic expansion, including an investment increasing its footprint, strong occupancy rates, and effective technology integration that enhances operational efficiency and customer convenience.
However, despite reporting a better-than-expected Q2 FFO of $4.23 per share on Jul. 30, the stock fell 2.8% the following day due to missing revenue expectations, a decline in realized annual rent per occupied square foot, and increased property tax and interest expenses. Additionally, the lowered 2024 guidance, reflecting a forecasted decline in same-store revenues and net operating income (NOI), compounded investor concerns.
While its rival Extra Space Storage Inc. (EXR) has delivered a 38.8% increase over the past 52 weeks, surpassing both PSA and the broader equity index, it has lagged behind PSA on a YTD basis with a 9.8% gain.
Despite the stock’s outperformance over the past year, analysts are cautiously optimistic about PSA’s prospects. The stock has a consensus rating of “Moderate Buy” from the 19 analysts in coverage, and as of writing, PSA is currently trading above the mean price target of $335.12.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
