SmartStop Self Storage REIT, Inc. (SMA) has received a new Buy rating, initiated by BMO Capital analyst, Juan C. Sanabria.
Juan C. Sanabria has given his Buy rating due to a combination of factors including SmartStop Self Storage REIT, Inc.’s strong market position as a top 10 operator in the US and Canada, and its high-quality portfolio that is well-positioned for growth through acquisitions. The company’s low leverage and unique non-traded managed REIT segment provide a captive acquisition pipeline, contributing to attractive asset screening. Sanabria also notes the expected above-peer growth, which makes the valuation appealing.
Additionally, recent improvements in storage fundamentals and the company’s strategic moves, such as leveraging more aggressive ECRIs and benefiting from hurricane-related demand, have positively impacted revenue growth. However, he acknowledges the risk of churn due to negative releasing spreads and a weaker consumer environment. Despite these risks, the overall outlook remains positive, leading to an Outperform rating with a $40 target based on NAV/DCF and earnings multiples.
Based on the recent corporate insider activity of 7 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of SMA in relation to earlier this year.