We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Public Storage (PSA) Q2 FFO Beats on Solid NOI, Revenues Up
Read MoreHide Full Article
Public Storage’s (PSA - Free Report) second-quarter 2018 funds from operations (FFO) per share of $2.65 improved 14.7% from the prior-year quarter figure of $2.31. The figure also surpassed the Zacks Consensus Estimate of $2.61.
Results highlight improvement in net operating income (NOI) from same-store and non-same store facilities. Higher realized annual rent per occupied square foot supported the company’s same-store performance. Additionally, Public Storage benefited from its expansion efforts.
Quarterly revenues of $685.5 million also climbed 3.2% from the prior-year quarter. However, the figure missed the Zacks Consensus Estimate of $689.0 million.
Behind the Headlines
Same-store revenues advanced 1.5% year over year to $558.7 million during the second quarter, while the company’s NOI inched up 1.2% to $407.8 million. The increase in same-store revenues was primarily driven by a 2.4% rise in realized annual rent per occupied square foot to $17.35. Nonetheless, the weighted-average square foot occupancy of 94.0% contracted 60 basis points year over year.
In addition, the company’s NOI from non-same store facilities grew on the back of the 137 self-storage facilities acquired and developed since January 2016.
Portfolio Activity
In the June-end quarter, Public Storage bought three self-storage facilities, comprising 0.2 million net rentable square feet of area, for $16 million. Following Jun 30, 2018, the company acquired or was under contract to acquire 14 self-storage facilities, spanning 0.8 million net rentable square feet of space, for $95.2 million.
Finally, as of Jun 30, 2018, the company had several facilities in development (2.2 million net rentable square feet), with an estimated cost of $315 million, as well as expansion projects (3.9 million net rentable square feet) worth roughly $364 million. Public Storage estimates to incur the remaining $445 million of development costs related to these projects mainly over the next 18 months.
Liquidity
Public Storage exited second-quarter 2018 with around $338.4 million of cash and cash equivalents, down from $433.4 million recorded at the end of the previous year.
Dividend
On Jul 25, Public Storage’s board of trustees announced a regular quarterly dividend of $2.00 per share. The amount will be paid on Sep 27 to shareholders of record as of Sep 12, 2018.
Shurgard Europe Update
Shurgard Europe is considering an initial public offering and in July, Public Storage received a cash distribution of $145.4 million from the former. This denotes the company’s 49% share of an aggregate dividend of $296.8 million.
In Conclusion
Public Storage is a recognized and established name in the self-storage industry in the United States. Furthermore, a solid balance sheet has enabled the company to pay sustainable dividends. Also, it is benefiting from strong industry fundamentals and favorable demographics in its markets. Amid these, the company’s acquisition and expansion efforts look promising.
Nevertheless, supply has been rising in a number of its markets. This limits its power to raise rents and turn on more discounting. Additionally, rate hike remains another concern.
We, now, look forward to the earnings releases of Lamar Advertising Company (LAMR - Free Report) , Host Hotels & Resorts, Inc. (HST - Free Report) and Outfront Media Inc. (OUT - Free Report) , all of which are scheduled to report their quarterly numbers next week.
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.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
Public Storage (PSA) Q2 FFO Beats on Solid NOI, Revenues Up
Public Storage’s (PSA - Free Report) second-quarter 2018 funds from operations (FFO) per share of $2.65 improved 14.7% from the prior-year quarter figure of $2.31. The figure also surpassed the Zacks Consensus Estimate of $2.61.
Results highlight improvement in net operating income (NOI) from same-store and non-same store facilities. Higher realized annual rent per occupied square foot supported the company’s same-store performance. Additionally, Public Storage benefited from its expansion efforts.
Quarterly revenues of $685.5 million also climbed 3.2% from the prior-year quarter. However, the figure missed the Zacks Consensus Estimate of $689.0 million.
Behind the Headlines
Same-store revenues advanced 1.5% year over year to $558.7 million during the second quarter, while the company’s NOI inched up 1.2% to $407.8 million. The increase in same-store revenues was primarily driven by a 2.4% rise in realized annual rent per occupied square foot to $17.35. Nonetheless, the weighted-average square foot occupancy of 94.0% contracted 60 basis points year over year.
In addition, the company’s NOI from non-same store facilities grew on the back of the 137 self-storage facilities acquired and developed since January 2016.
Portfolio Activity
In the June-end quarter, Public Storage bought three self-storage facilities, comprising 0.2 million net rentable square feet of area, for $16 million. Following Jun 30, 2018, the company acquired or was under contract to acquire 14 self-storage facilities, spanning 0.8 million net rentable square feet of space, for $95.2 million.
Finally, as of Jun 30, 2018, the company had several facilities in development (2.2 million net rentable square feet), with an estimated cost of $315 million, as well as expansion projects (3.9 million net rentable square feet) worth roughly $364 million. Public Storage estimates to incur the remaining $445 million of development costs related to these projects mainly over the next 18 months.
Liquidity
Public Storage exited second-quarter 2018 with around $338.4 million of cash and cash equivalents, down from $433.4 million recorded at the end of the previous year.
Dividend
On Jul 25, Public Storage’s board of trustees announced a regular quarterly dividend of $2.00 per share. The amount will be paid on Sep 27 to shareholders of record as of Sep 12, 2018.
Shurgard Europe Update
Shurgard Europe is considering an initial public offering and in July, Public Storage received a cash distribution of $145.4 million from the former. This denotes the company’s 49% share of an aggregate dividend of $296.8 million.
In Conclusion
Public Storage is a recognized and established name in the self-storage industry in the United States. Furthermore, a solid balance sheet has enabled the company to pay sustainable dividends. Also, it is benefiting from strong industry fundamentals and favorable demographics in its markets. Amid these, the company’s acquisition and expansion efforts look promising.
Nevertheless, supply has been rising in a number of its markets. This limits its power to raise rents and turn on more discounting. Additionally, rate hike remains another concern.
Public Storage currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Public Storage Price, Consensus and EPS Surprise
Public Storage Price, Consensus and EPS Surprise | Public Storage Quote
We, now, look forward to the earnings releases of Lamar Advertising Company (LAMR - Free Report) , Host Hotels & Resorts, Inc. (HST - Free Report) and Outfront Media Inc. (OUT - Free Report) , all of which are scheduled to report their quarterly numbers next week.
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.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>