Bank of America has lifted its rating on CubeSmart (CUBE, Financial) from Neutral to Buy, setting a new price target at $50, up from the previous $44. The decision reflects the company's advantageous positioning in urban markets, including New York City. Notably, CubeSmart stands out as the sole storage REIT that has already revised its FY25 guidance upwards, offering the most conservative forecast among its peers. With the second lowest leverage in the sector, CubeSmart's robust and adaptable financial structure supports potential external expansion, according to the analysis.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 15 analysts, the average target price for CubeSmart (CUBE, Financial) is $45.33 with a high estimate of $49.00 and a low estimate of $39.00. The average target implies an upside of 5.60% from the current price of $42.93. More detailed estimate data can be found on the CubeSmart (CUBE) Forecast page.
Based on the consensus recommendation from 18 brokerage firms, CubeSmart's (CUBE, Financial) average brokerage recommendation is currently 2.8, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for CubeSmart (CUBE, Financial) in one year is $45.87, suggesting a upside of 6.85% from the current price of $42.93. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the CubeSmart (CUBE) Summary page.
CUBE Key Business Developments
Release Date: May 02, 2025
- FFO per Share: $0.64, a $0.01 beat to the high end of guidance.
- Same-Store Revenue Growth: Down 0.4% year-over-year, improved from down 1.6% in Q4.
- Average Occupancy: Down 50 basis points to 89.5% in the first quarter.
- Move-In Rates: Down about 8% year-over-year, improved from down 10% in Q4.
- Same-Store Operating Expenses: Grew 0.6% year-over-year.
- Same-Store NOI Growth: Negative 0.8% for the quarter.
- Acquisition: Closed on the remaining 80% interest of a joint venture, investing $452.8 million.
- Third-Party Management: Added 33 stores, ending the quarter with 869 stores under management.
- Net Debt to EBITDA: 4.8 times.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- CubeSmart (CUBE, Financial) reported a strong first quarter with key performance metrics trending towards the higher end of expectations.
- Rental rates for new customers improved, narrowing the year-over-year gap, while existing customer health remained solid.
- The company achieved $0.64 of FFO per share, exceeding the high end of their guidance by $0.01.
- CubeSmart (CUBE) successfully closed on the acquisition of their joint venture partner's interest in a high-quality portfolio, expanding their presence in key markets.
- The company added 33 stores to their third-party management platform, ending the quarter with 869 third-party stores under management.
Negative Points
- Same-store revenue growth was down 0.4% year-over-year, although this was an improvement from the previous quarter.
- Average occupancy for the same-store portfolio decreased by 50 basis points to 89.5% during the first quarter.
- Move-in rates during Q1 were down about 8% year-over-year, although this was an improvement from the previous quarter.
- The company does not foresee any improvement in the frozen housing market due to the current rate environment and market uncertainty.
- CubeSmart (CUBE) maintained their prior range of expectations for top-line growth due to recent uncertainty around consumer behavior.
