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.
Why Is Extra Space Storage (EXR) Up 4.4% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for Extra Space Storage (EXR - Free Report) . Shares have added about 4.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Extra Space Storage due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Extra Space Storage Tops Q2 FFO Estimates, Raises View
Extra Space Storagereported second-quarter 2021 core FFO per share of $1.64, beating the Zacks Consensus Estimate of $1.56. The figure is also 33.3% higher than the prior-year quarter’s $1.23.
Quarterly revenues were $378.6 million, up 15.7% year over year. However, the top line lagged the Zacks Consensus Estimate of $379.8 million.
Results reflect strong average occupancy, and higher average rates to new and existing customers. The company also witnessed reductions in payroll and marketing expenses, partially offset by rise in property taxes and credit card processing fees.
Moreover, the company raised the mid-point of its FFO guidance by 8.3% to $6.53 per share, backed by its impressive performance in the year so far and improved outlook for the rest of the year.
Per Joe Margolis, CEO of Extra Space Storage, "We had an exceptionally strong second quarter, with record setting occupancy and very strong rental rates, resulting in same-store NOI growth of over 20%. Our excellent property performance, coupled with accretive investments, led to FFO growth of 33.3%.”
Quarter in Detail
Same-store rental revenues increased 13.6% year over year to $294.8 million in the second quarter. This uptick resulted from higher average occupancy and higher average rates to new and existing customers, higher late fees and lower bad debt, partly offset by increased discounts. Same-store square-foot occupancy expanded 280 basis points (bps), year over year, to 97% as of Jun 30, 2021.
Same-store expenses declined 2.3% year over year to $74.8 million, and underline reductions in payroll and marketing expense, muted by rise in property taxes and credit card processing fees to some extent. Consequently, same-store net operating income (NOI) increased 20.2% year over year to nearly $219.9 million.
Balance Sheet
Extra Space Storage exited second-quarter 2021 with $56 million of cash and cash equivalents, down from the $109.1 million recorded at the end of 2020. Notably, as of Jun 30, 2021, the company's percentage of fixed-rate debt to total debt was 72.7%.
During the reported quarter, the company completed its inaugural public bond offering, issuing $450 million of 10-year 2.55% senior unsecured notes due 2031.
Apart from this, the company closed $43 million in mortgage and mezzanine bridge loans, and sold $6 million in mortgage bridge loans in the second quarter.
Portfolio Activity
During the April-June period, Extra Space Storage acquired 13 operating stores and two stores at completion of construction for a total cost of roughly $184 million. In association with joint-venture partners, the company acquired five operating stores for a total of $68.7 million, of which the company invested $6.9 million.
Extra Space Storage added 39 stores (gross) to its third-party management platform. As of Jun 30, 2021, it managed 768 stores for third parties and 253 stores in joint ventures, with total stores under management of 1,021.
Outlook
The REIT raised the full-year core FFO per share range to $6.45-$6.60, marking an 8.3% increase at the mid-point. The company’s full-year projections are backed by same-store revenue growth assumptions of 10-11%, same-store NOI increase of 13.5-15.5% and $500 million in acquisitions.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 6.84% due to these changes.
VGM Scores
Currently, Extra Space Storage has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Extra Space Storage has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Extra Space Storage (EXR) Up 4.4% Since Last Earnings Report?
A month has gone by since the last earnings report for Extra Space Storage (EXR - Free Report) . Shares have added about 4.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Extra Space Storage due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Extra Space Storage Tops Q2 FFO Estimates, Raises View
Extra Space Storagereported second-quarter 2021 core FFO per share of $1.64, beating the Zacks Consensus Estimate of $1.56. The figure is also 33.3% higher than the prior-year quarter’s $1.23.
Quarterly revenues were $378.6 million, up 15.7% year over year. However, the top line lagged the Zacks Consensus Estimate of $379.8 million.
Results reflect strong average occupancy, and higher average rates to new and existing customers. The company also witnessed reductions in payroll and marketing expenses, partially offset by rise in property taxes and credit card processing fees.
Moreover, the company raised the mid-point of its FFO guidance by 8.3% to $6.53 per share, backed by its impressive performance in the year so far and improved outlook for the rest of the year.
Per Joe Margolis, CEO of Extra Space Storage, "We had an exceptionally strong second quarter, with record setting occupancy and very strong rental rates, resulting in same-store NOI growth of over 20%. Our excellent property performance, coupled with accretive investments, led to FFO growth of 33.3%.”
Quarter in Detail
Same-store rental revenues increased 13.6% year over year to $294.8 million in the second quarter. This uptick resulted from higher average occupancy and higher average rates to new and existing customers, higher late fees and lower bad debt, partly offset by increased discounts. Same-store square-foot occupancy expanded 280 basis points (bps), year over year, to 97% as of Jun 30, 2021.
Same-store expenses declined 2.3% year over year to $74.8 million, and underline reductions in payroll and marketing expense, muted by rise in property taxes and credit card processing fees to some extent. Consequently, same-store net operating income (NOI) increased 20.2% year over year to nearly $219.9 million.
Balance Sheet
Extra Space Storage exited second-quarter 2021 with $56 million of cash and cash equivalents, down from the $109.1 million recorded at the end of 2020. Notably, as of Jun 30, 2021, the company's percentage of fixed-rate debt to total debt was 72.7%.
During the reported quarter, the company completed its inaugural public bond offering, issuing $450 million of 10-year 2.55% senior unsecured notes due 2031.
Apart from this, the company closed $43 million in mortgage and mezzanine bridge loans, and sold $6 million in mortgage bridge loans in the second quarter.
Portfolio Activity
During the April-June period, Extra Space Storage acquired 13 operating stores and two stores at completion of construction for a total cost of roughly $184 million. In association with joint-venture partners, the company acquired five operating stores for a total of $68.7 million, of which the company invested $6.9 million.
Extra Space Storage added 39 stores (gross) to its third-party management platform. As of Jun 30, 2021, it managed 768 stores for third parties and 253 stores in joint ventures, with total stores under management of 1,021.
Outlook
The REIT raised the full-year core FFO per share range to $6.45-$6.60, marking an 8.3% increase at the mid-point. The company’s full-year projections are backed by same-store revenue growth assumptions of 10-11%, same-store NOI increase of 13.5-15.5% and $500 million in acquisitions.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 6.84% due to these changes.
VGM Scores
Currently, Extra Space Storage has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Extra Space Storage has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.