ASX:NSR – National Storage REIT (storing away profits for later use)

ASX:NSR National Storage REIT

Corporate Snapshot

Market Cap 535M (as of 2 April 2015)
Share Price: $1.60
Cash @ Dec 14 $ 9.5 M

What do they do:

Own and Run self storage facilities

Story in my view
Even though this is on the larger end of the small cap scale I still believe this has room for growth and is more a long term buy
mainly due to the cyclical and boring nature of the business, They are the only listed self storage provider and if the USA is anything to go by there isn’t going to be any reduction in the stuff people are going to accumulate and as they accumulate more stuff they need a place to put it so why not put it in self storage.

– Listed for just over 16 months
– risen 60% in that period
– still relative infancy and room for growth

Reasons to get on Board
– Still Acquiring properties for self storage
– diversified storage provider (Geographically + as a business) (personal, business, wine, vehicle storage + packaging & truck hire)
– Fragmented industry (no real big players)
– scale/ cost savings
– 70% occupancy rate with NPAT of over 30% of Revenue
– plans to diversify into recycling
– FY 14 Calendar year earnings in the $22.9 M range
– there is also opportunity to grow internationally (if they ever decide to pursue that path)

Reasons to NOT get on board
– debt levels are around 23% (recent capital raising helped reduce it)

My thoughts is that it is currently price at PE 26 ish
with historical market averages being around the 14’s
although factoring in 8c distributions you are looking at so very steady returns

Verdict – Accumulate and Hold for Income and Long Term Capital gains

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s