As urbanization progresses and living spaces in cities continue to shrink, the average individual may increasingly require a self-storage space to accommodate their belongings and valuables.
Want to tap in on the increase in popularity? Here’s a look at some of the best self storage stocks that you can invest in.
Best Self Storage Stocks To Track
Public Storage (NYSE: PSA)
Public Storage is an international self-storage company. Founded in 1972, the company owns and operates self-storage facilities that provide secure and convenient storage solutions.
It remains one of the largest self-storage companies in the world, with over 170 million square feet of net rentable space and 2,000 self-storage locations across the United States, Canada, and Europe.
The company has displayed consistent revenue growth in recent years, reporting a year-over-year increase of 17.8%.
It rounded up the last quarter with more than $1 billion in revenue.
Public Storage is constantly acquiring and also developing new properties. This development strategy has enabled the company to earn higher investment returns than its peers, who mainly report increases thanks to their recent acquisitions.
In addition to its self-storage operations, Public Storage also owns a 35% interest in Shurgard Self Storage, a European self-storage company, and multiple investments across various industries like industrial real estate, amongst many others.
The company boasts a market capitalization of more than $53 billion.
With a price-to-earnings ratio higher than the entire market, it is clear that Public Storage easily dominates the entire sector.
PSA earns its spot at the top of this list thanks to its high valuation and consistent numbers. The company’s stocks currently trade at approximately $307 as of April 2023.
It is also a dividend stock, with an annual payout of $12 and a dividend yield of 3.97%.
Extra Space Storage (NYSE: EXR)
Extra Space Storage is an American company that provides self-storage facilities. Founded in 1977, the company offers a variety of self-storage units for both business and personal use.
A significant portion of the company’s business comes from third-party management contracts, where it outsources management services to owners of self-storage facilities.
These services include property management, marketing and advertising, revenue management, maintenance, and repairs.
Extra Space Storage boasts over 1,900 self-storage facilities in the United States alone, making it the second-largest owner of self-storage in the country.
The company also provides self-storage units in other countries like Puerto Rico and the United Kingdom.
With a market capitalization that exceeds $23 billion and a 21% increase in revenue in 2022, the company continues to display firm valuation in the sector, with its cash flow by nearly 67% in the last year.
This is because, in terms of revenue growth, Extra Space Storage has outperformed all its peers in the last five years, with a growth rate in the sector surpassing 16%.
In recent news, the company is acquiring Life Storage, another company that provides self-storage facilities, in a $12 billion deal.
This merger is expected to increase the company’s portfolio by over 50%.
The company also recently acquired “Storage Express,” a move expected to boost its market share in the remotely managed storage sector.
It also gives the company access to smaller sites and newer markets.
EXR also offers its stockholders a chance to earn a dividend at a payout rate of $6 per annum and a dividend yield of 3.9%.
Its stock trades at roughly $154 per share as of April 2023.
CubeSmart (NYSE: CUBE)
CubeSmart is another company specializing in the ownership and acquisition of self-storage facilities in the United States.
The company offers a variety of services to its clients, such as truck rentals, moving services, and insurance services.
Founded in 2004 in Maryland, CubeSmart has grown to become one of the largest self-storage providers in the United States.
The company currently owns and operates more than 1,200 storage units, a staggering increase from the 460 properties it reported having in 2010.
The company reported a 22% increase in its year-to-year revenue in 2022, earning over a billion dollars in its last fiscal year.
With a market cap that surpasses $10 billion, CubeSmart continues to display enormous potential as a real estate investment trust, with its cash flow increasing by 19% over the last five years.
In December 2022, CubeSmart closed on acquiring 59 properties in the Southwest in a deal valued at $1.7 billion.
This increase in scale further expanded the company’s portfolio and its presence in key markets, benefiting shareholders.
CUBE also offers dividends on its shares at an annual rate of $1.96 and a dividend yield of 4.24%. The stock is trading roughly at $47 as of April.
National Storage Affiliates Trust (NYSE: NSA)
National Storage Affiliates is a real estate investment trust (REIT) founded in 2013. While the company is one of the smaller ones on this list, it manages to be one of the major players in the self-storage industry, so much so that we might as well call it a self-storage REIT.
The company is interested in over 1,100 self-storage properties in highly metropolitan areas.
Rather than operating all its properties under one national brand, the company owns and manages its facilities through strong regional brands by collaborating with independent self-storage operators.
This lets it avoid downside risk while still being able to expand its portfolio. The company continues to display budding potential and growth thanks to innovative strategies like this.
The company’s market capitalization stands at a whopping $5 billion and, as of 2022, reports an annual revenue of $183 million. This depicts a 25% increase in its year-over-year growth.
NSA stock currently trades at roughly $42 as of April 2023.
The company also offers shareholders a dividend yield of 5.27%, with an annual payout of $2.20 per share.
U-Haul Holding Company (NYSE: UHAL)
U-Haul Holding Company provides its customers a wide variety of services, including moving and storage solutions.
The company was a former subsidiary of its parent company, Amerco. However, on December 19th, 2022, the company became U-Haul Holding Company, transferring its common stock listing to the New York Stock Exchange.
While U-haul is more known for its rental trucks and moving business, the company has also established itself in the self-storage sector.
With over 71.6 million square feet owned or managed in the United States and Canada, U-Haul Holding remains one of the industry’s largest providers.
As a giant corporation, its market capitalization exceeds $10 billion and reported revenue growth of 4.8% in 2022.
Its self-storage units accounted for over $31 million of the company’s total revenue, reporting a 13% year-on-year growth in that sector alone.
While the company doesn’t currently offer dividends, it still remains a solid option thanks to its consecutive growth and overall consistency.
UHAL stock currently trades at $59 per share as at April 2023.
Global Self Storage (NASDAQ: SELF)
Global Self Storage is a self-storage company founded in 2011. It is also a self-administered and self-managed REIT (Real Estate Investment Trust).
Global Self Storage owns and manages an estimated 13 self-storage properties, which makes it one of the smallest self-storage REITs in the entire sector.
However, the company’s properties are located in cities throughout the United States, including New York, Pennsylvania, South Carolina, Texas, and many more.
Its strategy targets markets outside the top 25 metropolitan areas, allowing it wide access to an untapped market while limiting competition from giant corporations.
The company boasts of a market capital surpassing $57 million and experienced a 10.5% increase in its revenue in its last quarter alone.
Global Self Storage is expected to expand its compound annual growth by at least 7% in the next five years.
With low risk and a solid dividend payout, Global Self Storage earns its spot on this list with low risk and a solid dividend payout.
The company’s shares currently trade at a rough $5 as of April 2023.
Investors stand to earn dividends with a dividend yield of 5.64% and an annual payout rate of $0.29.
LifeStorage (NYSE: LSI)
LifeStorage is a real estate investment trust corporation headquartered in Williamsville, New York.
The company began operations in the self-storage sector in 1982, offering a range of self-storage facilities under two previously known brand names; Sovran Self Storage and Uncle Bob’s self-storage.
Life Storage owns and operates about 1,200 facilities across the US, making it the fourth largest provider of self-storage spaces nationwide.
With a market cap estimated at an impressive $11 billion, LifeStorage reported an annual revenue increase of up to 31% in 2022.
The company continues accelerating its revenue growth while maintaining a strict expenditure even during inflation.
However, with talks of Extra Space acquiring the company through a total stock buyout, the future of LifeStorage and its stock remains uncertain.
Potential investors are advised to monitor the company’s deliberations.
LSI stock currently trades at roughly $135 as of April 2023, offering shareholders an annual dividend yield of 3.66% and an annual payout rate of approximately $4.
Are Self Storage Stocks a Good Investment?
Self-storage stocks can be attractive investments due to several factors contributing to their growth and stability.
For instance, the demand for self-storage facilities is driven by common life events such as moving, downsizing, or decluttering, making the industry relatively resilient during economic downturns.
This stability offers investors a defensive option in their portfolios.
In addition, the self-storage industry has a relatively low capital expenditure and maintenance cost, allowing companies that run these spaces to maintain healthy profit margins.
This can translate into strong returns for investors over time.
Additionally, many self-storage companies are structured as REITs, which are required to distribute a significant portion of their income to shareholders as dividends. This offers investors an attractive, stable income stream.
It’s also worth noting that modern lifestyle set-ups, especially in big cities, have given rise to smaller living spaces and a growing need for external storage solutions.
As populations continue to grow and urbanize, the demand for self-storage facilities is expected to rise, driving growth in the industry and potentially benefiting self-storage stocks.
FAQs
Are There Self-Storage ETFs?
Currently, there is no specific ETF focused exclusively on the self-storage sector. However, self-storage stocks are within broader Real Estate Investment Trusts (REITs) ETFs.
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