We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Extra Space (EXR) Up 5.9% Since Earnings Report: Can It Continue?
Read MoreHide Full Article
It has been about a month since the last earnings report for Extra Space Storage Inc (EXR - Free Report) . Shares have added about 5.9% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is EXR due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Extra Space Surpasses Q4 FFO Estimates, Revenues Up Y/Y
Extra Space Storage’s fourth-quarter 2017 core FFO as adjusted per share of $1.12 handily surpassed the Zacks Consensus Estimate of $1.08. The figure also came in 8.7% higher than $1.03 recorded in the prior-year quarter. Results reflect growth in property-rental revenues and improvement in same-store NOI. Higher occupancy and rental rates supported growth.
Quarterly revenues of $281.8 million climbed 8% year over year. However, it missed the Zacks Consensus Estimate of $283.7 million.
For full-year 2017, the company reported FFO per share of $4.38, higher than the prior-year figure of $3.85. Further, revenues of $1.11 billion for full-year 2017 came ahead of the prior-year quarter figure of $991.9 million.
Behind the Headlines
Same-store revenues were up 4.9% year over year to $210.8 million during the fourth quarter, while same-store NOI climbed 5.7% to $154.9 million. The increase in same-store revenues was driven by higher rental rates for both new and existing customers as well as gains in occupancy. Same-store occupancy was 91.9% as of Dec 31, 2017, up 40 basis points from 91.5% as of Dec 31, 2016.
For 2017, Hawaii, Las Vegas, Los Angeles, Phoenix and Sacramento were the major markets which recorded revenue growth above the company's portfolio average. However, markets which performed below the company's portfolio average included Boston, Dallas, Denver and Houston.
Portfolio Activity
Extra Space Storage acquired 24 operating stores, eight stores at the completion of construction and it also purchased their joint-venture partners' interest in six stores for a total investment of around $500.5 million. Also, the company purchased three Certificate of Occupancy stores with a joint-venture partner for $46.6 million, out of which the company’s share was $11.8 million.
Notably, as of Dec 31, 2017, the company managed 422 stores for third-party owners. Moreover, with additional 215 stores owned and operated in joint ventures, the company’s total stores under management reached 637.
Balance Sheet
Extra Space Storage exited fourth-quarter 2017, with roughly $55.7 million of cash and cash equivalents, up from $43.9 million at the end of 2016. As of Dec 31, 2017, the company's percentage of fixed-rate debt to total debt was 74.7%. In addition, the company had $349.4 million available for issuance under the ATM program as of Dec 31, 2017.
Outlook
Extra Space Storage provided its outlook for 2018. The company anticipates FFO as adjusted per share in the band of $4.55-$4.65. The company projects same-store property revenue growth of 3.25-4.25% and same-store property NOI growth of around 3-4.5% for the year.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter.
At this time, EXR has an average Growth Score of C, however its Momentum is doing a lot better with an A. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for momentum investors than growth investors.
Outlook
Estimates have been trending upward for the stock and the magnitude of these revisions looks promising. It comes with little surprise EXR has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Extra Space (EXR) Up 5.9% Since Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Extra Space Storage Inc (EXR - Free Report) . Shares have added about 5.9% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is EXR due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Extra Space Surpasses Q4 FFO Estimates, Revenues Up Y/Y
Extra Space Storage’s fourth-quarter 2017 core FFO as adjusted per share of $1.12 handily surpassed the Zacks Consensus Estimate of $1.08. The figure also came in 8.7% higher than $1.03 recorded in the prior-year quarter. Results reflect growth in property-rental revenues and improvement in same-store NOI. Higher occupancy and rental rates supported growth.
Quarterly revenues of $281.8 million climbed 8% year over year. However, it missed the Zacks Consensus Estimate of $283.7 million.
For full-year 2017, the company reported FFO per share of $4.38, higher than the prior-year figure of $3.85. Further, revenues of $1.11 billion for full-year 2017 came ahead of the prior-year quarter figure of $991.9 million.
Behind the Headlines
Same-store revenues were up 4.9% year over year to $210.8 million during the fourth quarter, while same-store NOI climbed 5.7% to $154.9 million. The increase in same-store revenues was driven by higher rental rates for both new and existing customers as well as gains in occupancy. Same-store occupancy was 91.9% as of Dec 31, 2017, up 40 basis points from 91.5% as of Dec 31, 2016.
For 2017, Hawaii, Las Vegas, Los Angeles, Phoenix and Sacramento were the major markets which recorded revenue growth above the company's portfolio average. However, markets which performed below the company's portfolio average included Boston, Dallas, Denver and Houston.
Portfolio Activity
Extra Space Storage acquired 24 operating stores, eight stores at the completion of construction and it also purchased their joint-venture partners' interest in six stores for a total investment of around $500.5 million. Also, the company purchased three Certificate of Occupancy stores with a joint-venture partner for $46.6 million, out of which the company’s share was $11.8 million.
Notably, as of Dec 31, 2017, the company managed 422 stores for third-party owners. Moreover, with additional 215 stores owned and operated in joint ventures, the company’s total stores under management reached 637.
Balance Sheet
Extra Space Storage exited fourth-quarter 2017, with roughly $55.7 million of cash and cash equivalents, up from $43.9 million at the end of 2016. As of Dec 31, 2017, the company's percentage of fixed-rate debt to total debt was 74.7%. In addition, the company had $349.4 million available for issuance under the ATM program as of Dec 31, 2017.
Outlook
Extra Space Storage provided its outlook for 2018. The company anticipates FFO as adjusted per share in the band of $4.55-$4.65. The company projects same-store property revenue growth of 3.25-4.25% and same-store property NOI growth of around 3-4.5% for the year.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter.
Extra Space Storage Inc Price and Consensus
Extra Space Storage Inc Price and Consensus | Extra Space Storage Inc Quote
VGM Scores
At this time, EXR has an average Growth Score of C, however its Momentum is doing a lot better with an A. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for momentum investors than growth investors.
Outlook
Estimates have been trending upward for the stock and the magnitude of these revisions looks promising. It comes with little surprise EXR has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.