National Storage Affiliates (NSA) AI Stock Analysis

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National Storage Affiliates

(NYSE:NSA)

64Neutral

National Storage Affiliates exhibits solid financial performance with strong profitability, despite facing challenges in revenue and cash flow generation. Technical indicators suggest moderate upward momentum, while the valuation is relatively high, offset by a robust dividend yield. The earnings call conveyed mixed sentiment with strategic progress and ongoing operational challenges. Overall, the stock reflects stable but cautious prospects.

Positive Factors

Acquisitions

NSA through a joint venture with a state pension fund managed by Heitman Capital, acquired 18 properties for $147.9m, indicating a more constructive outlook on acquisitions.

Guidance

An encouraging guide shows light at the end of the tunnel for NSA, despite macro uncertainty.

Share Repurchase

A new share repurchase program has been approved, authorizing the repurchase of up to $350 million of common shares.

Negative Factors

Earnings Guidance

The core FFO per share guidance for 2025 is below consensus expectations.

Housing Demand

There is still lots of uncertainty on housing demand and move-in rate improvements, making larger-cap peers more comfortable options.

Same-Store Growth

NSA faces more relative risk in its guide compared to larger peers, with an expectation of slightly negative same-store growth.

National Storage Affiliates (NSA) vs. S&P 500 (SPY)

Market Cap

$4.68B

Dividend Yield6.52%

Average Volume (3M)906.86K

Price to Earnings (P/E)29.3

Beta (1Y)0.93

Revenue Growth-10.22%

EPS Growth-27.58%

CountryUS

Employees1,466

SectorReal Estate

Sector Strength86

IndustryREIT - Industrial

Share Statistics

EPS (TTM)1.14

Shares Outstanding76,445,970

10 Day Avg. Volume1,040,782

30 Day Avg. Volume906,858

Financial Highlights & Ratios

PEG Ratio0.39

Price to Book (P/B)N/A

Price to Sales (P/S)3.78

Price to Cash Flow (P/CF)9.10

P/FCF Ratio21.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$39.78

Price Target Upside18.25% Upside

Rating ConsensusHold

Number of Analyst Covering9

National Storage Affiliates Business Overview & Revenue Model

Company DescriptionNational Storage Affiliates Trust (NSA) is a real estate investment trust (REIT) focused on the ownership, operation, and acquisition of self-storage properties. The company is based in the United States and operates through a unique platform that partners with regional self-storage operators. NSA's portfolio includes a diverse range of self-storage facilities offering solutions for personal, business, and vehicle storage needs, catering to a wide customer base across various geographic locations.

How the Company Makes MoneyNational Storage Affiliates generates revenue primarily through the rental income from its self-storage facilities. The company owns and operates a vast portfolio of self-storage properties, which provide rental spaces to customers on a short-term or long-term basis. NSA's unique business model involves partnering with regional self-storage operators, known as Participating Regional Operators (PROs), which allows the company to leverage local expertise and enhance operational efficiencies. This partnership model not only helps in expanding its property portfolio but also contributes to stable and recurring revenue streams. Additionally, NSA may engage in ancillary services like the sale of storage-related products (such as locks and boxes) and tenant insurance, further diversifying its income sources. The company's earnings are influenced by factors such as occupancy rates, rental rate increases, and strategic acquisitions of new properties.

National Storage Affiliates Financial Statement Overview

Summary

National Storage Affiliates shows solid profitability and a strong balance sheet with low leverage. However, declining revenue and free cash flow, along with reduced equity, pose potential concerns for future growth and financial flexibility. The company should focus on reversing the revenue and cash flow decline to sustain its robust financial standing.

Income Statement

Positive

National Storage Affiliates shows solid profitability with a significant gross profit margin of 100% and a strong EBIT margin of about 72.5% for the 2024 period. However, there is a decline in total revenue from $858 million in 2023 to $770 million in 2024, indicating a negative growth trend. The net profit margin of approximately 24.8% in 2024 reflects stable profitability, yet EBITDA margin has decreased to 28.9% from 73% in the previous year, suggesting increased operational expenses.

Balance Sheet

Positive

The company maintains a low debt-to-equity ratio of 0.02, reflecting conservative financial leverage. A strong equity ratio of 20.1% suggests a stable capital structure with considerable equity financing. However, stockholders' equity has decreased from $1.42 billion in 2023 to $1.08 billion in 2024, indicating potential concerns with equity retention. Return on equity stands at approximately 17.7%, demonstrating good profitability relative to equity.

Cash Flow

Neutral

Free cash flow has decreased from $406 million in 2023 to $344 million in 2024, indicating a negative growth rate. The operating cash flow to net income ratio of 1.9 suggests efficient cash generation relative to net income. The free cash flow to net income ratio is approximately 1.8, indicating healthy cash flow coverage but highlighting a decline in free cash flow generation.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
770.34M	858.06M	801.57M	585.67M	432.22M
	Gross Profit
770.34M	407.08M	590.54M	430.41M	308.74M
	EBIT
558.48M	336.69M	296.33M	222.63M	146.17M
	EBITDA
531.15M	626.72M	529.49M	380.94M	263.34M
	Net Income Common Stockholders
111.52M	156.67M	183.76M	146.94M	79.48M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
50.41M	94.59M	35.31M	25.01M	18.72M
	Total Assets
5.35B	5.93B	6.07B	5.56B	3.51B
	Total Debt
22.89M	3.68B	3.58B	2.96B	1.94B
	Net Debt
-27.52M	3.62B	3.54B	2.94B	1.92B
	Total Liabilities
3.59B	3.81B	3.68B	3.08B	2.08B
	Stockholders Equity
1.08B	1.42B	1.65B	1.78B	968.96M
Cash Flow		Free Cash Flow
344.41M	406.03M	400.12M	303.35M	203.90M
	Operating Cash Flow
363.06M	441.58M	443.85M	331.35M	220.65M
	Investing Cash Flow
425.42M	161.10M	-584.16M	-2.00B	-509.68M
	Financing Cash Flow
-825.42M	-557.19M	154.64M	1.67B	286.45M

National Storage Affiliates Technical Analysis

Technical Analysis Sentiment

Negative

Last Price33.64

Price Trends

50DMA

37.26

Negative

100DMA

38.24

Negative

200DMA

40.46

Negative

Market Momentum

MACD

0.36

Negative

RSI

57.64

Neutral

STOCH

80.96

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NSA, the sentiment is Negative. The current price of 33.64 is below the 20-day moving average (MA) of 37.14, below the 50-day MA of 37.26, and below the 200-day MA of 40.46, indicating a bearish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 57.64 is Neutral, neither overbought nor oversold. The STOCH value of 80.96 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NSA.

National Storage Affiliates Risk Analysis

National Storage Affiliates disclosed 36 risk factors in its most recent earnings report. National Storage Affiliates reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

National Storage Affiliates Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLYM	78 Outperform	$657.93M	4.67	25.95%	6.72%	-0.75%	1514.44%
PSA	77 Outperform	$49.52B	26.54	21.01%	4.25%	3.94%	-3.81%
IIPR	75 Outperform	$1.47B	9.38	8.20%	14.67%	-0.32%	-4.24%
CUBE	73 Outperform	$8.77B	22.14	13.80%	5.38%	1.51%	-5.16%
EXR	71 Outperform	$30.07B	33.65	6.02%	4.78%	27.21%	-18.39%
NSA	64 Neutral	$4.68B	29.26	8.92%	6.52%	-10.22%	-27.58%
Sector *	61 Neutral	$4.30B	16.20	-3.61%	11.22%	6.29%	-21.37%

* Real Estate Sector Average

Performance Comparison

NSA

National Storage Affiliates

33.64

-1.91

-5.37%

CUBE

Cubesmart

37.05

-5.13

-12.16%

EXR

Extra Space Storage

131.84

-5.61

-4.08%

PSA

Public Storage

278.07

13.34

5.04%

IIPR

Innovative Industrial Properties

48.70

-41.72

-46.14%

PLYM

Plymouth Industrial Reit

13.70

-6.70

-32.84%

National Storage Affiliates Earnings Call Summary

Earnings Call Date: Feb 26, 2025 | % Change Since: -10.63% | Next Earnings Date: May 5, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed sentiment with significant strategic achievements, such as brand consolidation and operational efficiencies, and strong capital deployment. However, challenges such as a decline in same store revenue and NOI, interest expense impact, and leverage pressure were also highlighted. The company is optimistic about future market conditions and internal efficiencies driving growth.

Highlights

Strategic Portfolio Restructuring

In 2024, NSA consolidated its brands from 12 to 7, onboarded approximately 250 properties and over 380 employees, and completed the conversion to a single new property management system.

Capital Deployment and Share Repurchase

NSA deployed $150 million of growth capital in a joint venture, sold 49 core facilities for over $270 million, and repurchased $275 million of common shares.

Operational Efficiency Gains

NSA improved operational efficiencies by internalizing the pro structure and consolidating platforms, resulting in expected cost savings and improved execution capabilities.

Improving Market Conditions and Outlook

NSA anticipates a recovery in the housing market, which is expected to positively impact its operations. Supply in the market is expected to decline, with new deliveries decreasing from 3.5% in 2024 to 2% by 2027.

Core FFO Guidance

Core FFO per share was $0.60 for Q4 2024 and $2.44 for the full year, reaching the high end of the guidance range.

Lowlights

Decline in Same Store Revenue and NOI

Same store revenue and NOI growth were down 3% and 5.5%, respectively, for the full year. For Q4, same store revenues declined 4.3%, driven by a decline in rent revenue per square foot of 2.5% and a 180 basis point year-over-year decline in average occupancy.

Interest Expense Impact

Interest expense is expected to negatively impact core FFO per share by approximately $0.05 due to the expiration of interest rate swaps and the impact of higher effective rates on the revolver.

Near-Term Leverage Pressure

Leverage was at 6.5 times net debt to EBITDA at quarter end, with expectations of additional pressure in the near term due to negative NOI growth in the first quarter.

Challenges in Key Markets

Markets like Phoenix and Atlanta face challenges from new supply, which will take time to absorb, impacting NSA's ability to achieve material improvements in these areas.

Company Guidance

During the National Storage Affiliate Trust's fourth quarter 2024 conference call, management provided guidance for 2025, detailing several key metrics. The company expects same-store revenue growth to be flat, with operating expenses growing by 3.5% and NOI declining by 1.4%. The guidance for core FFO per share is set at $2.34, down from $2.44 in 2024, primarily due to increased interest expenses and negative organic growth. Interest expense is anticipated to impact core FFO by approximately $0.05, due to expiring interest rate swaps. The acquisition and disposition ranges are forecasted between $100 million and $300 million, with a focus on leveraging joint ventures. Despite a challenging operating environment, the company anticipates improved performance in the second half of the year, driven by a recovering housing market and reduced supply pressures, with new deliveries expected to decline from 3.5% in 2024 to 2% by 2027.

National Storage Affiliates Corporate Events

Executive/Board ChangesShareholder Meetings

Rebecca Steinfort to Leave National Storage Affiliates Board

Neutral

Feb 13, 2025

On February 13, 2025, Rebecca L. Steinfort announced her decision not to seek re-election to the board of trustees of National Storage Affiliates Trust at the next annual meeting on May 12, 2025. Her departure will result in the reduction of the board size from twelve to eleven members, and her choice was not due to any disputes with the company.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.