How Analysts View Public Storage
We can guess about Public Storage’s (PSA) expected performance in the upcoming months of 2017 by looking at its analyst ratings.
The value of an REIT such as Public Storage (PSA) is commonly measured by using its price-to-FFO (funds from operations) multiple.
REITs such as Public Storage (PSA) distribute at least 90% of their taxable incomes to shareholders in the form of dividends and share repurchases.
Public Storage (PSA) has regularly rewarded its shareholders in the form of quarterly dividends. The company has paid a dividend in every quarter since 1981.
In a higher household income scenario, people tend to spend more on acquiring properties and need more storage space. This need boosts demand for self-storage facilities.
REITs will likely be significantly affected by rising interest rates. Rising mortgage rates will increase the cost of purchasing investment properties.
Public Storage (PSA) puts a great deal of focus on the development and redevelopment of its existing facilities. Recently, there’s been a trend of rising rent for self-storage facilities.
Self-storage facility owners such as Public Storage are expected to ride high backed by higher demand for storage, mainly due to demographic changes and higher rent.
Macroeconomic factors such as high rent and demographic changes have resulted in high demand for self-storage facilities.
Rent growth has moderated, but it remains at record highs. In such a scenario, consumers prefer apartments whose rents are affordable. This is where self-storage REITs come in.
The analysts covering Prologis have assigned the stock a mean price target of $57.8, which is the same as its current price level.
In order to qualify as an REIT (real estate investment trust), companies like Prologis (PLD) have to pay almost 90% of their taxable income as dividends.
Prologis’s price-to-FFO multiple is now 20.95x, which means that it has been returning consistent capital value and reliable dividend yields to investors.
Rising optimism in US markets bodes well for commercial REITs like Prologis, Duke Realty, Kilroy Realty, and Boston Properties.
Commerical REITs (real estate investment trusts) have to pay at least 90% of their taxable income as dividends or share buybacks.
REITs (real estate investment trusts) such as Prologis, Duke Realty, Kilroy Realty, and Boston Properties have largely benefited from low interest rates.
Prologis is expected to achieve a growth rate of 6%, 5.8%, 9.1% and 8.7%, respectively, in AFFO (adjusted funds from operations) over the next four quarters.
Prologis has increased its owned and managed real estate by 85 million square feet (~16%) over the past two years.
Prologis is expected to generate a revenue growth of 6.7%, 5.1%, 6.4%, and 5.1%, respectively, in 2Q17, 3Q17, 4Q17, and 1Q18.
Prologis is expected to ride high on its growth trajectory. For 2017, it raised its adjusted FFO (funds from operation) projection by $0.10 per share.