EXR

Two High-Quality Self-Storage REITs Beat Estimates and Raise Guidance

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Image Shown: Shares of CubeSmart (depicted by the blue line) and Public Storage (depicted by the orange line), two self-storage REITs that are included as ideas in the High Yield Dividend Newsletter portfolio, have surged higher year-to-date. By Callum Turcan We are big fans of the self-storage real estate investment trust (‘REIT’) industry, particularly in the US. These REITs offer their customers an economical way to maximize their living space at a time when domestic housing prices are surging from a baseline that is already quite high. Additionally, self-storage REITs are well-positioned to push through continuous rent increases given that the monthly rental expense for a self-storage unit for an ordinary US household likely represents just a sliver of their … Read more

CubeSmart Outperforms and Boosts Its Full-Year Guidance

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Image Source: CubeSmart – June 2021 IR Presentation By Callum Turcan We are big fans of the self-storage real estate investment trust (‘REIT’) industry given the ability for firms operating in this arena to generate meaningful free cash flows, a difficult task for most REITs considering their hefty capital expenditure requirements. CubeSmart (CUBE) is one of our favorites in the space and we include shares of CUBE as an idea in the High Yield Dividend Newsletter portfolio. Shares of CUBE are up 38% year-to-date as of the end of normal trading hours on June 10, easily outpacing the 12% gain seen in the S&P 500 (SPY) during this period before taking dividend considerations into account. As of this writing, shares of … Read more

Public Storage’s Traditional Free Cash Flow Coverage of the Dividend Is Unique for a REIT

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Image Source: Mike Mozart By Brian Nelson, CFA Public Storage (PSA) reported better-than-expected fourth-quarter 2020 results February 24. For the period ending December 31, 2020, net income came in at $1.67 per common share, down from last year’s level but mainly because of a non-operating negative impact related to forex on Euro denominated debt ($35.1 million). On an operating basis, Public Storage’s self-storage net operating income advanced $16.5 million year-over-year in the quarter, which was only modestly offset by higher general and administrative expenses ($12.3 million). Underlying business performance at Public Storage remains very healthy, in our view. Core funds from operations (FFO) per share came in at $2.93 in the quarter, up 3.2% in the year-ago period (above the … Read more

ALERT: Raising Cash in the Newsletter Portfolios

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January 27, 2021 ALERT: Raising Cash in the Newsletter Portfolios We are raising the cash position in the simulated Best Ideas Newsletter portfolio and simulated Dividend Growth Newsletter portfolio to 10%-20%. — By Brian Nelson, CFA — Our research has been absolutely fantastic for a long time, but 2020 may have been our best year yet. You can read the 2020 recap here. With the S&P 500 trading within our fair value estimate range of 3,530-3,920 (and the markets rolling over while showing signs of abnormal behavior), we’re raising the cash position in the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to 10%-20%. — For more conservative investors, the high end of this range may even be larger, especially … Read more

Public Storage Receives Interest from Activist Investor

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Image Shown: A look at Public Storage’s geographical footprint at the end of 2019, keeping in mind some of these properties are owned by its strategic partners. Image Source: Public Storage – 2019 Annual Report By Callum Turcan We are big fans of the self-storage industry and include Public Storage (PSA) in our High Yield Dividend Newsletter portfolio. One of the greatest things about Public Storage is the ability for this self-storage real estate investment trust (‘REIT’) to generate sizable positive free cash flows, a rarity in the REIT world. We have covered this dynamic in detail in the past (link here). Shares of PSA yield ~3.6% as of this writing and we see room for significant payout growth over … Read more

Public Storage Continues to Shine

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Image Shown: Shares of Public Storage have recovered from the depths of the COVID-19 pandemic and have been on an upward climb over the past few months.   By Callum Turcan On November 4, Public Storage (PSA) reported earnings for the third quarter of 2020. As expected, headwinds created by the coronavirus (‘COVID-19’) pandemic weighed on its financial performance during this period; however, that did not stop the self-storage real estate investment trust (‘REIT’) from being very free cash flow positive. The long-term outlook for the self-storage industry in metropolitan areas in the US and elsewhere remains quite promising given the desire for households to maximize living space within their housing unit at a given budget. We include shares of … Read more

CubeSmart Is One of Our Favorite REITs

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Image Source: CubeSmart – October 2020 Deluxe Storage Transaction IR Presentation By Callum Turcan On November 5, the self-storage real estate investment trust (‘REIT’) CubeSmart (CUBE) reported third quarter earnings for 2020 that missed consensus top-line estimates but beat consensus funds from operations (‘FFO’) estimates. The REIT’s financial performance has taken a hit from the ongoing coronavirus (‘COVID-19’) pandemic, though CubeSmart adjusted by launching its contactless online rental program SmartRental back in April. Furthermore, after suspending its normal schedule for rental rate increases earlier this year, CubeSmart resumed those increases in June and July. CubeSmart has also since resumed its normal delinquency process, on a jurisdiction by jurisdiction basis. We include shares of CubeSmart as a holding in our High … Read more

Public Storage Rebounds and Its Financials Remain Strong

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Image Shown: Shares of Public Storage have recovered a considerable amount of lost ground since the pandemic-induced drop in March 2020. We continue to like Public Storage as a holding in our High Yield Dividend Newsletter and are big fans of self-storage companies with significant exposure to the US. By Callum Turcan The self-storage real estate investment trust (‘REIT’) Public Storage (PSA) is included as a holding in our High Yield Dividend Newsletter portfolio. We strongly appreciate its free cash flows, which are relatively rare in the REIT industry given that the growth-related capital expenditures of most REIT’s tend to be enormous. Shares of PSA have rebounded strongly off their March 2020 lows and yield ~3.6% as of this writing. … Read more

CubeSmart Remains Rock-Solid

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Image Shown: An overview of CubeSmart’s core geographical focus. We continue to like CubeSmart as a holding in our High Yield Dividend Newsletter portfolio. Image Source: CubeSmart – September 2020 IR Presentation By Callum Turcan One of our favorite industries as it relates to locating high-quality high-yielding companies with promising dividend growth runways is the self-storage real estate investment trust (‘REIT’) space, particularly companies with operations primarily (if not entirely) in the US. Within this industry, CubeSmart (CUBE) is one of our favorites and remains a holding in our High Yield Dividend Newsletter portfolio. Shares of CUBE yield ~4.0% as of this writing. The self-storage REIT continued to make good on its dividend obligations during the initial stages of the … Read more

3 Lessons in Portfolio Management Over 10 Years

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Dear members: — We’re finally getting a pause in the rapid ascent of the markets on September 3rd. Though headlines may look scary and momentum/volatility investors could start to pile on to the downside, a modest retracement is actually a good thing. We continue to focus on the long haul with our processes, and we’re viewing the sell-off as profit taking, for the most part. — In the near term, the markets will also have to digest some speculators betting on mean reversion between “value” (cyclical) versus “growth” (secular), but we maintain the view that the value-versus-growth conversation is largely nonsense (see block quotes below), and mean reversion is something akin to the gamblers’ fallacy, in my humble opinion. Investors should also continue … Read more