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Factors to Impact Extra Space Storage's (EXR) Q1 Earnings
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Extra Space Storage (EXR - Free Report) is slated to report first-quarter 2021 earnings on Apr 28, after the bell. Both its quarterly revenues and funds from operations (FFO) per share are likely to display year-over-year increases.
In the last reported quarter, this Salt Lake City, UT-based self-storage real estate investment trust (REIT) delivered a surprise of 9.63% in terms of FFO per share. Results reflected solid average occupancy and higher average rates to existing customers for the quarter, partially offset by lower late fees.
Over the trailing four quarters, the company surpassed the Zacks Consensus Estimate on each occasion, the average beat being 6.16%. The graph below depicts this surprise history:
Let’s see how things have shaped up prior to this announcement.
Factors to Consider
In the first quarter, Extra Space Storage is likely to have benefited from its solid presence in key cities and measures to boost the company’s geographical footprint through accretive acquisitions and third-party management.
Markedly, the self-storage industry continues to benefit from favorable demographic changes. Specifically, migration and downsizing trend, and increase in the number of people renting homes have further spurred the needs of consumers to rent spaces at storage facilities to park their possessions.
Further, demand for self-storage space has shot up amid the flexible working environment as well as improving housing market, while move-outs remain low amid the health crisis, resulting in improved year-over-year occupancy trends. In fact, rentals continue to be steady while vacates continue to be muted, a trend that is expected to have continued in the first quarter. Amid these, the REIT is likely to have seen growth in revenues in the first quarter with healthy rental rates.
Management and franchise fees for the quarter are projected at $14.21 million, indicating an improvement from the prior quarter’s $13.83 million. The Zacks Consensus Estimate of $306 million for quarterly property rental revenues suggests an increase from the fourth quarter’s $301 million and the year-ago period’s $287 million. The Zacks Consensus Estimate of $360.9 million for first-quarter revenues suggests an 8.6% increase year on year.
However, the company operates in a highly fragmented market in the United States, with intense competition from numerous private, regional and local operators. In addition, there is a development boom of self-storage units in several markets. This high supply is likely to have fueled competition, curbed its power to raise rents and turned on more discounting during the quarter under consideration.
Extra Space Storage’s activities during the quarter were inadequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly FFO per share has remained unrevised at $1.48 in a month’s time. However, it calls for a 19.4% year-over-year rise.
Here is what our quantitative model predicts:
Our proven model does not conclusively predict a positive surprise in terms of FFO per share for Extra Space this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a FFO beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Extra Space currently carries a Zacks Rank #2 (Buy) and has an Earnings ESP of -0.63%.
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this quarter:
CubeSmart (CUBE - Free Report) , slated to release quarterly numbers on Apr 29, has an Earnings ESP of +3.14% and carries a Zacks Rank of 3 at present.
Welltower, Inc. (WELL - Free Report) , slated to release quarterly earnings on Apr 28, currently has an Earnings ESP of +0.93% and carries a Zacks Rank of 3.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Factors to Impact Extra Space Storage's (EXR) Q1 Earnings
Extra Space Storage (EXR - Free Report) is slated to report first-quarter 2021 earnings on Apr 28, after the bell. Both its quarterly revenues and funds from operations (FFO) per share are likely to display year-over-year increases.
In the last reported quarter, this Salt Lake City, UT-based self-storage real estate investment trust (REIT) delivered a surprise of 9.63% in terms of FFO per share. Results reflected solid average occupancy and higher average rates to existing customers for the quarter, partially offset by lower late fees.
Over the trailing four quarters, the company surpassed the Zacks Consensus Estimate on each occasion, the average beat being 6.16%. The graph below depicts this surprise history:
Extra Space Storage Inc Price and EPS Surprise
Extra Space Storage Inc price-eps-surprise | Extra Space Storage Inc Quote
Let’s see how things have shaped up prior to this announcement.
Factors to Consider
In the first quarter, Extra Space Storage is likely to have benefited from its solid presence in key cities and measures to boost the company’s geographical footprint through accretive acquisitions and third-party management.
Markedly, the self-storage industry continues to benefit from favorable demographic changes. Specifically, migration and downsizing trend, and increase in the number of people renting homes have further spurred the needs of consumers to rent spaces at storage facilities to park their possessions.
Further, demand for self-storage space has shot up amid the flexible working environment as well as improving housing market, while move-outs remain low amid the health crisis, resulting in improved year-over-year occupancy trends. In fact, rentals continue to be steady while vacates continue to be muted, a trend that is expected to have continued in the first quarter. Amid these, the REIT is likely to have seen growth in revenues in the first quarter with healthy rental rates.
Management and franchise fees for the quarter are projected at $14.21 million, indicating an improvement from the prior quarter’s $13.83 million. The Zacks Consensus Estimate of $306 million for quarterly property rental revenues suggests an increase from the fourth quarter’s $301 million and the year-ago period’s $287 million. The Zacks Consensus Estimate of $360.9 million for first-quarter revenues suggests an 8.6% increase year on year.
However, the company operates in a highly fragmented market in the United States, with intense competition from numerous private, regional and local operators. In addition, there is a development boom of self-storage units in several markets. This high supply is likely to have fueled competition, curbed its power to raise rents and turned on more discounting during the quarter under consideration.
Extra Space Storage’s activities during the quarter were inadequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly FFO per share has remained unrevised at $1.48 in a month’s time. However, it calls for a 19.4% year-over-year rise.
Here is what our quantitative model predicts:
Our proven model does not conclusively predict a positive surprise in terms of FFO per share for Extra Space this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a FFO beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Extra Space currently carries a Zacks Rank #2 (Buy) and has an Earnings ESP of -0.63%.
Stocks That Warrant a Look
Here are a few stocks in the REIT sector that you may want to consider, as our model shows that these have the right combination of elements to report a positive surprise this quarter:
Digital Realty Trust, Inc. (DLR - Free Report) , scheduled to report quarterly numbers on Apr 29, currently has an Earnings ESP of +1.06% and carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CubeSmart (CUBE - Free Report) , slated to release quarterly numbers on Apr 29, has an Earnings ESP of +3.14% and carries a Zacks Rank of 3 at present.
Welltower, Inc. (WELL - Free Report) , slated to release quarterly earnings on Apr 28, currently has an Earnings ESP of +0.93% and carries a Zacks Rank of 3.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>