FBR Capital on Real Estate: Self Storage REITs: Storage Sizzle--Raising Targets, Updating Estimates
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Price: $146.81 -0.31%
Rating Summary:
11 Buy, 15 Hold, 0 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
11 Buy, 15 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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FBR Capital on Real Estate: Self Storage REITs: Storage Sizzle--Raising Targets, Updating Estimates (+2014E)
FBR analyst said, "The subsector continues to be a year-to-date winner, outpacing the RMZ by 400 bps. We remain supportive of the group given reasonable "relative" valuations, and expect the sizzle to continue as core growth improves into the seasonal summer peak. Yesterday's sell-off could be an opportunity to take a bigger position in the higher-growth group. We are adjusting our 2011−2013 FFO and AFFO per share estimates for Extra Space Storage (NYSE: EXR)(Market Perform), Public Storage (NYSE: PSA)(Underperform), Sovran Self Storage (NYSE: SSS)(Outperform), and U-Store-It-Trust (NYSE: YSI)( Outperform). We are also introducing our 2014 FFO and AFFO per share estimates. We have updated our forward LIBOR assumptions, cap rates, and unlevered IRR assumptions. Based on new financials and updated forward-12-month estimates, we have also adjusted our NAV per share estimates and related price targets."
Extra Space Storage (EXR – Market Perform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $1.10, $1.28, and $1.36, respectively, from $1.07, $1.17, and $1.24. The changes are predicated on higher occupancy offset by higher property operating expenses. We introduce our 2014 FFO/share estimate of $1.50...We are raising our price target to $21.50 from $20.50
Public Storage (PSA – Underperform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $5.87, $6.14, and $6.43, respectively, from $5.77, $5.94, and $6.18. The changes are predicated upon higher occupancy gains offset by lower rent rate growth. We introduce our 2014 FFO/share estimate of $6.65...We are raising our price target to $114.00 from $104.50.
Sovran Self Storage (SSS – Outperform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $2.64, $2.81, and $2.87, respectively, from $2.61, $2.71, and $2.74. The changes are predicated on higher occupancy offset by lower rent rate growth. We introduce our 2014 FFO/share estimate of $2.98...We are raising our price target to $52.50 from $50.00.
U-Store-It-Trust (YSI – Outperform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $0.61, $0.69, and $0.71, respectively, from $0.62, $0.69, and $0.71. The changes are predicated on lower rent rate growth and higher property operating expenses. We introduce our 2014 FFO/share estimate of $0.75...We are raising our NAV-per-share estimate to $11.20 from $10.70.
FBR analyst said, "The subsector continues to be a year-to-date winner, outpacing the RMZ by 400 bps. We remain supportive of the group given reasonable "relative" valuations, and expect the sizzle to continue as core growth improves into the seasonal summer peak. Yesterday's sell-off could be an opportunity to take a bigger position in the higher-growth group. We are adjusting our 2011−2013 FFO and AFFO per share estimates for Extra Space Storage (NYSE: EXR)(Market Perform), Public Storage (NYSE: PSA)(Underperform), Sovran Self Storage (NYSE: SSS)(Outperform), and U-Store-It-Trust (NYSE: YSI)( Outperform). We are also introducing our 2014 FFO and AFFO per share estimates. We have updated our forward LIBOR assumptions, cap rates, and unlevered IRR assumptions. Based on new financials and updated forward-12-month estimates, we have also adjusted our NAV per share estimates and related price targets."
Extra Space Storage (EXR – Market Perform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $1.10, $1.28, and $1.36, respectively, from $1.07, $1.17, and $1.24. The changes are predicated on higher occupancy offset by higher property operating expenses. We introduce our 2014 FFO/share estimate of $1.50...We are raising our price target to $21.50 from $20.50
Public Storage (PSA – Underperform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $5.87, $6.14, and $6.43, respectively, from $5.77, $5.94, and $6.18. The changes are predicated upon higher occupancy gains offset by lower rent rate growth. We introduce our 2014 FFO/share estimate of $6.65...We are raising our price target to $114.00 from $104.50.
Sovran Self Storage (SSS – Outperform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $2.64, $2.81, and $2.87, respectively, from $2.61, $2.71, and $2.74. The changes are predicated on higher occupancy offset by lower rent rate growth. We introduce our 2014 FFO/share estimate of $2.98...We are raising our price target to $52.50 from $50.00.
U-Store-It-Trust (YSI – Outperform) - We are adjusting our 2011, 2012, and 2013 FFO/share estimates to $0.61, $0.69, and $0.71, respectively, from $0.62, $0.69, and $0.71. The changes are predicated on lower rent rate growth and higher property operating expenses. We introduce our 2014 FFO/share estimate of $0.75...We are raising our NAV-per-share estimate to $11.20 from $10.70.
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