Public Storage Stock Price Forecast: While driving to work, biking to the beach or maybe even if you’re on a cross-country road trip, there’s a high chance you may have come across a Public Storage [NYSE: PSA] building. Public Storage is the largest self-storage company in the United States, as of 2019.
Whether you are looking to store your valuables while you’re in the middle of a move or you just need extra storage, then this is the company that can help you with storage services.
Public Storage has also been around since 1972, and you don’t become the U.S.’ largest self-storage company if you aren’t making your investors happy. The company has had a history of having a strong balance sheet and is one of the most recognized self-storage brands in the United States.
But it’s important to know the basics behind Public Storage [NYSE: PSA] stock to determine if it’s worth buying. Here’s what you need to know:
What Does Public Storage Do?
Public Storage’s primary business structure is to offer its consumers a self-storage location.
At these locations, consumers can pick from a range of units, including business storage, climate-controlled storage, and vehicle storage.
Public Storage’s business storage is ideal for holding office equipment, paper, or your company’s inventory. And its climate-controlled storage helps protects items from incurring weather- or climate-related damage, such as damage from the cold, heat, or humidity. Consumers can also take advantage of Public Storage’s vehicle storage services to hold their vehicles, collector cars, or even vehicles they work on as a hobby.
What makes Public Storage [NYSE: PSA] ahead of the curve compared to other companies in the self-storage industry is its technology, acquisitions, and brand recognition.
For instance, Public Storage makes it easy to find a location near your home and reserve a unit quickly thanks to its seamless online platform and app.
Also, the company has a widely recognized across the U.S. and Europe thanks to its strong brand. Moreover, this Maryland-based real estate investment trust (REIT) company has a self-storage operations business segment responsible for acquisitions, which has helped make Public Storage Europe and the United State’s largest landlord and the world’s largest self-storage facilities owner.
Is Public Storage a Buy?
Compared to its three closest competitors on the market, Public Storage’s market cap is more than all three combined.
Public Storage [NYSE: PSA] also has one of the lowest debt/capitalization of any company at less than five percent. What this means is that if the market suffers another recession or if the company experiences bad times, PSA will likely be able to adapt and survive these adverse conditions.
Additionally, over 90 percent of Public Storage’s units are occupied by consumers. Yet the company has reported they only need to occupy 30 percent of its units to break even. That gives the company a massive amount of wiggle room to make a profit.
Moreover, the company’s dividend has increased over 700 percent for its stockholders since 2000, making it a worthwhile stock to buy and hold for income-oriented investors.
The company also plans to expand its overseas footprint by owning more facilities in the coming future. PSA remains a strong buy candidate thanks to its performance over the years.
What are the Risks of Buying Public Storage?
No matter which stock you choose to invest in, all have some type of risk, including PSA. PSA is still subject to market conditions. That means it will likely stay stagnant in a downturn, making it challenging to gain a profit.
Moreover, a market downturn can halt expansion plans, which has played an integral role in helping PSA grow over the years.
Also, Public Storage [NYSE: PSA] has low debt. This means the company isn’t taking advantage of borrowing money at the current low-interest rates, which can help them expand more.
The company also runs the risk of being locked in a higher interest rate loan if they borrow at the wrong time.
Public Storage Stock Price Forecast Summary
Over 10 analysts forecast that the PSA stock could surprise the $260-mark over the next year.
But projections also place PSA at a median value of $223 and the lowest value of $193 if conditions shift for the worse.
Analysts have mixed strategies for trading PSA. Some investment analysts suggest that existing owners should continue holding on to PSA while others suggest buying more and a minority suggest selling the stock.
Analysts are already forecasting that the third and fourth quarters of 2019 should see higher earnings per share than earnings from the first two quarters of the year.
Year-to-year (YTD) sales are also expected to increase for the rest of 2019 and going into 2020.
If you’re looking for a stock to add to your portfolio as part of your long-term trading strategy, then it’s worth considering Public Storage [NYSE: PSA].
PSA stock has several favorable conditions that place it as a great stock to buy, even with the risks it has. With several analysts forecasting good growth, Public Storage doesn’t seem to be slowing down any time soon.
It’s a company that’s built a good foundation to survive shifting market conditions and one that keeps investors’ worries at bay. Just do your research before committing to the stock and see is a right fit in your portfolio and for your investment goals.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.