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Public Storage (PSA)
NYSE:PSA
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Public Storage
(NYSE:PSA)80Outperform
Positive Factors
Growth Opportunities
Public Storage expanded its portfolio by acquiring and contracting to acquire several self-storage facilities.
Negative Factors
Financial Performance
Public Storage reported third-quarter core FFO below analyst expectations.
Operational Challenges
Same-store revenue and net operating income were below previous levels, indicating some operational challenges.
Public Storage (PSA) vs. S&P 500 (SPY)
Market Cap
$55.08B
Dividend Yield3.82%
Average Volume (3M)716.86K
Price to Earnings (P/E)29.5
Beta (1Y)0.87
Revenue Growth3.94%
EPS Growth-3.81%
CountryUS
Employees6,200
SectorReal Estate
Sector Strength72
IndustryREITs
Share Statistics
EPS (TTM)10.64
Shares Outstanding175,415,530
10 Day Avg. Volume975,785
30 Day Avg. Volume716,855
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)11.73
Price to Cash Flow (P/CF)17.90
P/FCF Ratio16.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$329.20Price Target Upside4.97% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
Public Storage Business Overview & Revenue Model
Company DescriptionPublic Storage (PSA) is a leading real estate investment trust (REIT) specializing in self-storage facilities. Founded in 1972 and headquartered in Glendale, California, the company operates thousands of self-storage locations across the United States and Europe. Public Storage provides a variety of storage solutions for personal, business, and vehicle storage needs, offering units in different sizes and configurations. The company is known for its widespread presence, brand recognition, and commitment to providing secure, clean, and convenient storage options for its customers.
How the Company Makes MoneyPublic Storage makes money primarily through the rental of storage units. Customers pay monthly fees to rent these units, and the company charges based on the size and location of the unit, as well as any additional services or amenities provided. The company's revenue model is largely based on maximizing occupancy rates and optimizing pricing strategies to reflect demand fluctuations. Public Storage also generates income from ancillary services such as the sale of packing supplies and insurance products. Significant factors contributing to its earnings include strategic acquisitions to expand its portfolio, maintaining high operational efficiency, and leveraging its brand strength to attract and retain customers.
Public Storage Financial Statement Overview
Summary
Public Storage displays a strong financial position with high profitability and effective cash flow management, underpinned by robust revenue growth and solid margins. While the balance sheet is stable with a good equity ratio, rising debt levels require monitoring. Overall, the company is well-positioned within the REITs sector.Income Statement
Public Storage demonstrates strong profitability with a consistent gross profit margin around 73% and an impressive EBIT margin above 70%. Revenue growth is stable, with a notable increase from 2022 to 2023. However, net profit margin slightly decreased in the latest year due to lower net income, indicating a small dip in overall profitability.85
Very Positive
Balance Sheet
The company has a moderate debt-to-equity ratio, reflecting balanced financial leverage. The equity ratio is strong, with over 48% of assets financed by stockholders' equity, indicating financial stability. However, increasing debt levels could pose risk if not managed alongside equity growth.78
Positive
Cash Flow
Public Storage exhibits robust cash flow management, with significant free cash flow supporting operations. The operating cash flow consistently exceeds net income, highlighting efficient cash conversion. A substantial increase in free cash flow in 2023 further strengthens the company's liquidity position.90
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 4.70B | 4.52B | 4.18B | 3.42B | 2.92B | Gross Profit |
| 3.44B | 3.35B | 3.13B | 2.50B | 2.05B | EBIT |
| 3.33B | 3.30B | 2.17B | 1.71B | 1.41B | EBITDA |
| 3.51B | 3.34B | 3.79B | 2.86B | 2.44B | Net Income Common Stockholders |
| 2.08B | 2.15B | 4.35B | 1.95B | 1.36B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 447.42M | 370.00M | 775.25M | 734.60M | 257.56M | Total Assets |
| 19.75B | 19.81B | 17.55B | 17.38B | 11.82B | Total Debt |
| 9.35B | 9.10B | 6.87B | 7.48B | 2.54B | Net Debt |
| 8.91B | 8.73B | 6.10B | 6.74B | 2.29B | Total Liabilities |
| 9.94B | 9.70B | 7.39B | 7.96B | 3.24B | Stockholders Equity |
| 9.71B | 10.01B | 10.07B | 9.34B | 8.56B |
| Cash Flow | Free Cash Flow | |||
| 3.13B | 2.79B | 2.66B | 2.27B | 1.87B | Operating Cash Flow |
| 3.13B | 3.25B | 3.12B | 2.54B | 2.04B | Investing Cash Flow |
| -1.00B | -3.54B | 1.12B | -5.56B | -1.12B | Financing Cash Flow |
| -2.08B | -112.93M | -4.19B | 3.50B | -1.08B |
Public Storage Technical Analysis
Positive
313.60
Price Trends
299.87
Positive
314.59
Negative
312.01
Positive
Market Momentum
3.05
Negative
60.46
Neutral
62.44
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PSA, the sentiment is Positive. The current price of 313.6 is above the 20-day moving average (MA) of 305.02, above the 50-day MA of 299.87, and above the 200-day MA of 312.01, indicating a bullish trend. The MACD of 3.05 indicates Negative momentum. The RSI at 60.46 is Neutral, neither overbought nor oversold. The STOCH value of 62.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PSA.
Public Storage Risk Analysis
Public Storage disclosed 33 risk factors in its most recent earnings report. Public Storage reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Public Storage Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $113.94B | 29.93 | 6.97% | 3.20% | 2.22% | 23.71% | |
80 Outperform | $55.08B | 29.51 | 21.01% | 3.82% | 3.94% | -3.81% | |
76 Outperform | $9.84B | 24.94 | 13.80% | 4.77% | 1.51% | -5.16% | |
74 Outperform | $9.22B | 33.62 | 3.38% | 4.13% | 17.48% | 7.45% | |
74 Outperform | $34.81B | 39.00 | 6.02% | 4.12% | 27.21% | -18.39% | |
65 Neutral | $5.32B | 33.37 | 8.92% | 5.69% | -10.22% | -27.58% | |
61 Neutral | $4.91B | 18.99 | -3.12% | 7.77% | 6.71% | -19.69% |
* Real Estate Sector Average
Performance Comparison
PSA
Public Storage
313.60
33.11
11.80%
CUBE
Cubesmart
42.76
-0.84
-1.93%
EXR
Extra Space Storage
155.76
12.31
8.58%
PLD
Prologis
117.87
-12.02
-9.25%
REXR
Rexford Industrial Realty
39.69
-11.34
-22.22%
NSA
National Storage Affiliates
39.59
3.39
9.36%
Public Storage Earnings Call Summary
Earnings Call Date: Feb 24, 2025 | % Change Since: 3.38% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed sentiment. While there are significant achievements such as operational stabilization, digital transformation, and increased acquisition activity, challenges remain in the form of revenue declines, competitive pressures, and impacts from the Los Angeles fires.Highlights
Positive Year-End Results
The company ended 2024 with broad operational stabilization, with nearly all markets having improved. Same-store revenue growth improved sequentially for the first time in over two years, and core FFO per share growth turned positive.
Successful Completion of Property of Tomorrow Program
The multi-year, $600 million investment into rebranding has been completed, positioning the company for increased annual retained cash flow from $400 million in 2024 to approximately $600 million in 2025.
Digital Transformation and Operational Efficiency
The company's digital transformation has led to a 30% reduction in on-property labor hours, while also increasing customer satisfaction and reducing utility use by 30%.
Acquisition Activity and Strong Capital Position
Acquisition activity increased with 26 properties acquired or under contract for $361 million in the fourth quarter. The company maintains strong leverage and balance sheet capacity.
Improving Market Conditions
Markets like Miami and Orlando showed positive trends, and overall, the supply of new storage facilities is expected to decline further in 2025.
Lowlights
Impact of Los Angeles Fires
The state of emergency in Los Angeles due to fires will lead to an estimated $0.23 per share impact on core FFO in 2025 due to pricing restrictions.
Decline in Same-Store Revenues
Same-store revenues declined by 60 basis points year-over-year in the fourth quarter.
Challenging Competitive Dynamics
Despite improvements, competitive dynamics continue to pose challenges, with move-in rents expected to be down 5% year-over-year on average in 2025.
Increased Same-Store Expenses
Same-store expenses increased by 90 basis points year-over-year, driven by property taxes.
Company Guidance
In the recent earnings call for Public Storage, the company presented its guidance for 2025, highlighting several key financial and operational metrics. The company achieved core FFO of $4.21 per share in Q4 2024, marking a 20 basis point increase year-over-year, despite a 60 basis point year-over-year decline in same-store revenues. For 2025, Public Storage provided core FFO per share guidance of $16.35 to $17, with an estimated $0.23 per share impact due to pricing restrictions from a state of emergency in California. They anticipate a 3.25% same-store expense growth, mainly driven by property taxes, and expect same-store NOI to decline by 1.4% at the midpoint. The company also noted that it completed the "Property of Tomorrow" program, a $600 million investment, which is expected to boost annual retained cash flow from $400 million in 2024 to $600 million in 2025. Additionally, they reported a reduction in property labor hours by nearly 30% due to digital transformation efforts, contributing to improved customer satisfaction and operational efficiencies. Public Storage plans to enhance its growth through a $740 million development pipeline and anticipates higher acquisition volumes in 2025 compared to 2024.Public Storage Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Public Storage Appoints Christopher Sambar as COO
Positive
Oct 31, 2024
Public Storage has appointed Christopher Sambar as its principal operating officer, bringing his extensive experience from AT&T Communications. Joining the company in October 2024, Sambar’s new role includes participation in the executive compensation program, with a base salary of $800,000, potential annual incentives, and a significant new hire bonus. His strategic leadership is expected to drive operational excellence and growth at Public Storage.
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.