PSA
Public Storage$306.94
Sell
Target $198.40
Report: Mar 08, 2026Real Estate • REIT - Industrial • Asset-Based OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$306.94-35.4%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$198.40
(35% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$312.95
52 Week Low$256.54
Avg. 3 Month Volume1.26M
Efficiency
LTM Gross Margin72.8%
LTM EBITDA Margin67.0%
LTM EBIT Margin43.2%
LTM Operating Margin46.4%
LTM ROA7.9%
LTM ROE16.9%
LTM ROIC7.1%
LTM ROCE10.4%
Capital Structure
Market Cap (MM)$47.5B
Enterprise Value (MM)$57.5B
Shares Outstanding175.47M
Total Debt (MM)$10.25B
Cash & Equivalents (MM)$318.10M
LTM Net Debt (MM)$9.94B
LTM Net Debt/EBITDA3.1x
Growth
TTM Rev. Growth2.7%
Last 3-Yr Rev. CAGR4.9%
Last 3-Yr EBITDA CAGR-15.6%
Last 3-Yr EPS CAGR-27.4%
Valuation
Street Target Price$301.60
LTM EV/Revenue11.9x
LTM EV/Gross Profit16.4x
LTM EV/EBIT27.6x
LTM EV/EBITDA17.8x
LTM P/E30.0x
LTM EV/FCF22.2x
LTM P/FCF18.4x
LTM P/TB2.4x
LTM P/B5.1x
Dividend Yield4.4%
Payout Ratio132.7%
Executive SummarySituation: Current price is $306.94 versus fair value $198.4 (-35.4% expected return), and valuation confidence is stable. Debate: Bull case depends on 2026 Core FFO Guidance Realization Management has guided for a 2026 Core FFO midpoint of $16.68, a 1.7% year-over-year decline. Bear case centers on Interest Rate Pivot and Cap Rate Compression A significant decline in interest rates could lead to sector-wide cap rate compression, which would disproportionately benefit PSA's high-quality asset base and potentially drive the stock bac... Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
The 'PS4.0' strategy successfully leverages AI and data science to drive utilization above 95%, while solar investments and automated staffing permanently lower the expense floor. Furthermore, a rapid absorption of Sunbelt supply could allow move-in rents to pivot from -10% to positive growth by late 2026.
Bear Case
The company continues to reinvest capital at returns (6.1% ROIC) that do not cover its cost of capital (9.5%), leading to persistent value erosion. Additionally, same-store NOI continues to decline as California rent restrictions and Sunbelt oversupply prove more durable than management's 'stabilization' narrative suggests.
Key Catalysts
Mid-Term (6-18 months)Impact: High
2026 Core FFO Guidance Realization Management has guided for a 2026 Core FFO midpoint of $16.68, a 1.7% year-over-year decline. As quarterly...
Mid-Term (6-18 months)Impact: Critical
Sunbelt Supply Absorption Failure If move-in rents in markets like Atlanta and Florida fail to stabilize by late 2026, the 'temporary' suppl...
Long-Term (18+ months)Impact: Moderate
Public Storage is at a critical juncture as it enters 2026 with a new CEO, a new headquarters, and a guide for declining earnings, making it...
Primary Risks
Concern: Medium
Interest Rate Pivot and Cap Rate Compression A significant decline in interest rates could lead to sector-wide cap rate compression, which w...
Concern: High
Regulatory Contagion The California-wide rent-restriction emergency and the Los Angeles state of emergency are currently dragging same-store...
Concern: Medium
The governance outlook is dominated by the upcoming leadership reset. We identify a three-pronged Governance Outcome Tree: 1. Status Quo (Bo...
Recent Activity
2025-07-31SEC Filing (8-K)
-5.79%Public Storage reported Q2 2025 results with $1.76 diluted EPS and $4.28 Core FFO per share, raising full-year outlook.
2023-11-14Market Movement
+5.55%Market/Sector Move +5.55%
2022-11-02SEC Filing (8-K)
-8.00%Public Storage reported Q3 2022 results with $15.38 diluted EPS and $4.13 Core FFO per share, up 20.8% YoY.
2022-04-29Market Movement
-6.89%Market/Sector Move -6.89%
Valuation Table
9.8/10Decision Grade
Scenario Range
$123
Bear
$246
Base
$299
Bull
$307