Storage Trusts Follow Public Storage Down, Despite U-Store-It Rising (PSA, YSI, EXR, SSS)
May 9, 2008 by Douglas A. McIntyrePublic Storage (NYSE: PSA) is seeing some pressure this morning after earnings. Interestingly enough, its smaller counterpart U-Store-It Trust (NYSE: YSI) rose a sharp 3.5% to $11.99 after its earnings.
As u-Store-It was already closer to lows, had seen more selling, is only a $693 million stock market cap, and is generally far less representative of the entire extra-storage space property sector… the sector is following the lead of Public Storage.
Public Storage posted funds from operations excluding items and excluding currency of $1.16, while estimates were $1.24. The company attributed a shortfall compared to estimates as being due to higher than expected domestic expenses. The company also showed a decrease in per square foot occupancy from 90.1% in Q1 2007 to 89.5%, although that was offset by a 3.8% increase in rent to $13.82 per annual square foot.
After looking over the books, the company is actually in great shape financially and it should have more than enough to keep repurchasing shares and to keep paying out its dividends. The bad news is that it is no longer believed to be cheap on an underlying real estate land-bank basis.
With a $14.9 Billion market cap after a 5% drop today to $87.14, this one looks fully valued based on the current valuations and based on the current economic climate. Its 52-week trading range is $65.66 to $98.01. Five years ago, this was trading at about $36.00 per share.
This is also weighing on a few related companies today. Extra Space Storage Inc. (NYSE: EXR) is seeing shares trade down over 1% at $16.74 and Sovran Self Storage Inc. (NYSE: SSS) is seeing shares down over 1% at $43.13.
Jon C. Ogg
May 9, 2008
Essential Tips for Investing: Sponsored
A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses, consider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.