11am ET…January 30, 2008 — Comment on Markets, Companies & Events in the News
Trailer For Sale or Rent
Wall Street has a way of bringing out the more practical views about current events. One theme getting visibility focuses on the public storage companies. If downsizing housing is in store for the millions forecast, the three most prominent could experience accelerated earnings growth. Consensus earnings forecast 5% – 10% growth for Amerco (UHAL: $70.00); Public Storage (PSA: $78.63) and Sovran Storage (SSS: $39.46).
Another company in that space, however, seems a better value…U-Store-It Trust (YSI: $9.24). This is a self-administered, self-managed real estate investment trust focused on self-storage facilities. Here is a link for guidance on 2008 http://biz.yahoo.com/iw/071213/0339504.html
The company projects a dividend of about $0.80…which translates into a yield of 9%. Whether the re-housing of America increases sales or not, a 9% return isn’t a bad premium while waiting.
Here’s a table summarizing these four companies. YSI operating margins are close to PSA’s, the industry leader, yet its market valuation to sales is one-third.
REVISITS- Wal-Mart de Mexico (WMMVF: $3.53) was written up at $3.50 and appears poised to make its move. Same store sales continue to come in at 8%. Overall, Wal-Mex represents about 10% of Wal-Mart USA’s sales and as much as 20% of Net Income.
Westpac Banking (WBK: $113.15) was mentioned as a world class money center bank that might stay out of the sub-prime fray…and these have moved up. Remember, the stock price is an ADR and is comprised of 5 shares of common stock…so 100 ADRs of WBK is equivalent to 500 shares of its common stock.
Kubota (KUB: $35.30), a prominent agricultural and construction equipment manufacturer has begun to respond to an increased following in the USA. Its stock price is up 10% since showcased here (January 24th). Caterpillar (CAT: $68.99) and Deere (DE: $86.71) are also up, but by 5%.
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