PSA - 4.3%-Yielding Public Storage: A Steady Eddie You May Need In Your Portfolio

2024-03-18 13:04:27 ET

Summary

• Public Storage is a resilient choice for long-term investors, offering steady income through dividends and strong growth potential.
• The company has a strong track record of outperforming the broader REIT space and utilizes technological advancements to gain a competitive edge.
• While there are near-term challenges such as rising costs and potential revenue slowdown, Public Storage's long-term potential remains strong.

Introduction

When it comes to long-term investing, I believe in finding the sweet spot between buying income and growth. Unless you are retired and depending on income from your investments, I believe it makes the most sense to focus on the best of two worlds: companies with consistent growth that are able to reward shareholders through dividends.

This is what Merrill Lynch wrote in a report on income-focused investments (emphasis added):

Many investors choose dividend-paying stocks in the hope that they’ll provide both income and asset growth . During times when interest rates are rising, which generally means the economy is doing well, the likelihood is greater that a dividend-paying stock can do both . One note of caution, though: Some stocks with high-dividend yields can potentially drop in value when rates rise — if a company is highly leveraged, the cost of servicing their debt increases when rates go up , and that can have an impact on what their stock is worth.

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