CubeSmart (CUBE, Financial) has been upgraded by BMO Capital from Market Perform to Outperform, with the price target adjusted to $49, up from the previous $48. The update comes as CubeSmart becomes the firm's top choice in the storage sector, due to its significant presence in urban areas, which is seen as a strength, particularly in New York City.
The analysts are optimistic about CubeSmart's potential, citing an expected year-over-year increase in same-store revenue growth by 0.3% for fiscal year 2025. This forecast is based on the anticipation that management will likely boost guidance, supported by a noticeable acceleration in in-place rates.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 16 analysts, the average target price for CubeSmart (CUBE, Financial) is $46.31 with a high estimate of $50.00 and a low estimate of $43.00. The average target implies an upside of 8.43% from the current price of $42.71. 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 2.6, 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 $46.38, suggesting a upside of 8.59% from the current price of $42.71. 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.
