UPDATE: Extra Space Storage (EXR) PT Raised to $135 at Stifel as Shares Trade at an Unjustified Discount

Stifel analyst Stephen Manaker raised the price target on Extra Space Storage (NYSE: EXR) to $135.00 (from $130.00) after 4Q20 Core FFO of $1.48/share beat consensus ($1.34) on higher revenue, driven by strong demand and low vacates, ($0.07/share) and higher interest income ($0.04). During the quarter, EXR acquired $147 million in selfstorage assets, sold $47 million, and added six stores (net) to its third-party management platform.

The analyst reiterated a Buy rating, stating "We expect EXR's bottom-line to grow 14.2% in 2021 and 3.7% in 2022 (assuming no acquisitions or growth in loan book for now), while the REIT sector is expected to grow 1.8% in 2020. Despite this strong growth, EXR trades at 20.0x our 2021 estimate, below the 21.4x multiple for the REIT group. And the REIT's leverage is about 0.2x below the sector average. The stock trades at just a 5.2% premium to our NAV. This means you get EXR's platform for just $824 million (or $11/square foot); a bargain in our view, given the company's ability to grow bottom-line earnings through traditional and non-traditional means".

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