An analyst from Citi today advises a hold on stock for Extra Space Storage Inc. (NYSE: EXR), with a price target of $7. The analyst indicated to StreetInsider.com that while the company’s long-term outlook for the self-storage industry is positive, margins will likely be inhibited by reduced consumer demand and an overall weak economy. A historical trailing four-quarter correlation of .75 between same-store net-operating income and gross domestic product may indicate the toll the economy is taking on Extra Space, the analyst said. In addition, Citi expects there could be a risk to the dividend of $1 per share, which is currently uncovered by cash flow.
Salt Lake City-based Extra Space is a self-administered and self-managed real estate investment trust that that owns or operates 654 self-storage properties in 33 states and Washington, D.C.
Source: StreetInsider.com, Citi Initiates Coverage on Extra Space Storage Inc (EXR) with a Hold, Attractive Long-Term Valuation