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Public Storage (PSA) Notes Key Growth Initiatives, Shares Up 2.6%

·3 min read

Shares of Public Storage PSA gained 2.6% in yesterday’s trading hours. Responding to the letter from Elliott Associates, L.P. and Elliott International, L.P, Public Storage issues a statement indicating that it will "continue to take decisive action to drive sustainable value creation".

The company is one of the largest owners and operators of storage facilities in the United States. In fact, the ‘Public Storage’ brand is the most recognized and established name in the self-storage industry. This success is supported by its growth strategies, including acquisitions, development and redevelopment efforts to improve customer satisfaction.

In fact, the company noted that since the start of 2019, it has expanded the portfolio by 13.9 million net rentable square feet on the back of buyouts, development and redevelopment worth $1.9 billion. This also includes the $500-million acquisition of the Beyond Storage portfolio.

Over the same period, Public Storage has delivered $471 million of properties through its development platform and has a current pipeline of $563 million activity planned. Public Storage has also enhanced the scale of its third-party property management business by adding 113 properties.

Other than these organic and inorganic growth measures, the company continued to be focused on its $500-million “Property of Tomorrow” investment program, spanning more than five years. This program aimed at improving customer satisfaction and enhancing its existing portfolio.

To fund such growth moves, the company has raised more than $3 billion of debt and preferred capital.

Additionally, it has been emphasizing both occupancy and rent optimization, and this has been driving revenue growth and impressive revenue per available foot. Further, by allocating capital in its in-house technology platform, it has been able to witness efficiencies in operational capability, workflows and labor, while enhancing customer and employee experiences.

Markedly, the successful execution of such growth strategies and efforts to enhance operating platform have enabled the company to see a 20-year CAGR of 7% in core funds from operations (FFO) per share and 12% in dividends per share.

Shares of this Zacks Rank #3 (Hold) company have gained 12.4% over the past six months compared with the industry’s growth of 0.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


Stocks to Consider

CubeSmart’s CUBE Zacks Consensus Estimate for 2020 FFO per share has moved up 1.2% to $1.65 over the past month. The company currently carries a Zacks Rank of 2 (Buy).

Rexford Industrial Realty, Inc. REXR FFO per share estimates for the current year have been revised upward by 1.6% to $1.30 over the past two months. The company carries a Zacks Rank of 2, currently.

City Office REIT, Inc.’s CIO Zacks Consensus Estimate for ongoing-year FFO per share has moved 5.3% north to $1.20 in two months’ time. The company has a Zacks Rank of 2 at present.

Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.

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Public Storage (PSA) : Free Stock Analysis Report
CubeSmart (CUBE) : Free Stock Analysis Report
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City Office REIT, Inc. (CIO) : Free Stock Analysis Report
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