In a report released today, Denese Newton from Stifel Nicolaus maintained a Hold rating on Big Yellow Group, with a price target of p975.00.
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Denese Newton has given his Hold rating due to a combination of factors influencing Big Yellow Group’s current financial performance and future prospects. Despite a decline in occupancy rates, the company has managed to increase its net rent per square foot by 5%, resulting in a total revenue growth of 3% for the quarter. This increase in rental rates has helped offset the occupancy decline, and the company expects continued EPS growth due to ongoing rental rate improvements and the completion of new developments.
However, Big Yellow’s shares have underperformed compared to the UK EPRA Index, and its current PE ratio is at the lower end of its trading range. While the company has a robust pipeline of new store openings that could drive future growth, macroeconomic uncertainties pose significant near-term challenges. Given these mixed signals, Denese Newton has opted for a Hold rating, balancing the potential for long-term growth against the current economic climate and stock performance.
Newton covers the Real Estate sector, focusing on stocks such as Big Yellow Group, Segro plc (REIT), and Tritax Big Box REIT. According to TipRanks, Newton has an average return of 3.2% and a 60.00% success rate on recommended stocks.