NSA - National Storage Affiliates: A Distressed REIT With A Premium Valuation

2024-06-10 15:44:28 ET

Summary

• National Storage Affiliates is a storage REIT with 65% exposure to the Sun Belt region.
• Occupancy and net operating income were both down Y/Y so far in 2024.
• The debt maturity profile is well-staggered, with net debt representing 40% of enterprise value.
• The market cap rate of about 7.2% is not reflecting the deteriorating operating performance, a key risk for the shares.
• The company is making efforts to lower even further the level of general and administrative expenses.

Introduction

National Storage Affiliates ( NSA ) has largely performed in line with the Vanguard Real Estate Index Fund ETF ( VNQ ) so far in 2024, posting a mid-single-digit negative price return....

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