BMO Capital analyst Juan C. Sanabria has maintained their neutral stance on CUBE stock, giving a Hold rating on February 21.
Juan C. Sanabria has given his Hold rating due to a combination of factors including Cubesmart’s recent financial performance and future outlook. The company’s fourth-quarter earnings for 2024 aligned with expectations, but the core results showed a deceleration in year-over-year in-place rates, which is a concern. Additionally, the guidance for 2025 funds from operations (FFO) fell short of expectations, and the core guidance appeared weaker than anticipated.
Furthermore, Cubesmart’s same-store revenue guidance for 2025 is below that of its peers, indicating potential challenges in maintaining competitive growth. On a positive note, the company has made strategic moves by acquiring two joint ventures, enhancing its balance sheet capacity. However, the overall demand catalysts for storage remain uncertain, particularly with the housing market showing signs of weakness. As a result, Sanabria sees more promising growth opportunities with other storage peers, especially those with greater exposure to the sunbelt region.
In another report released on February 21, Wells Fargo also maintained a Hold rating on the stock with a $44.00 price target.