2023-06-15 09:37:37 ET
Wells Fargo on Thursday initiated coverage of CubeSmart ( NYSE: CUBE ) with an Overweight Rating, given its "attractive" risk/reward.
"CUBE's high-quality portfolio of population-dense markets, favorable leverage/liquidity, and potential to partake in consolidation create attractive risk/reward," said analyst Eric Luebchow.
While CubeSmart ( CUBE ) has slightly lower exposure to faster-growing Sunbelt markets vs. certain peers, it also has lower risk in a potential downturn given favorable demographic and supply/demand characteristics.
Wells Fargo expects CubeSmart ( CUBE ) to post 2023/2024 core FFO per share of $2.70/$2.85 vs. $2.71/$2.86 consensus . "We are forecasting ~6.5% core FFO per share growth through 2025 and 5% same-store NOI growth, well ahead of storage peer NSA," said Luebchow.
Price target was set at $50, implying 14.3% potential upside to CUBE's last close. Shares +0.6% .
Wells Fargo's stance is in line with bullish sell-side as well as SA Quant ratings .
More on self-storage REITs
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Wells Fargo initiates CubeSmart at Overweight on attractive risk/reward