Yahoo Finance Strength Seen in Life Storage (LSI): Can Its 3.5% Jump Turn into More Strength?
Life Storage (LSI) shares soared 3.5% in the last trading session to close at $135.73. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 2.9% gain over the past four weeks.
This increased investor optimism can be attributed to the news of its acquisition by Extra Space Storage Inc. EXR in an all-stock transaction. The move will result in the combined company becoming the largest storage operator in the country. The combined entity is poised to benefit from the enhanced size, scale, diversification and synergies.
Per the agreement terms, shareholders of Life Storage will get 0.8950 of an Extra Space share for each share they own. Based on Extra Space's share price close on Mar 31, 2023, this represents a total consideration of roughly $145.82 per share. This reflects a premium of 11.23% based on LSI’s closing price last Friday.
This self storage real estate investment trust is expected to post quarterly funds from operations (FFO) of $1.64 per share in its upcoming report, which represents a year-over-year change of +13.9%. Revenues are expected to be $263.34 million, up 12.8% from the year-ago quarter.
FFO and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in FFO estimate revisions are strongly correlated with near-term stock price movements.
For Life Storage, the consensus FFO per share estimate for the quarter has been revised 0.8% lower over the last 30 days to the current level. And a negative trend in FFO estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on LSI going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Life Storage belongs to the Zacks REIT and Equity Trust - Other industry. Another stock from the same industry, Outfront Media (OUT), closed the last trading session 1.1% lower at $16.05. Over the past month, OUT has returned -6.7%.
For Outfront Media , the consensus FFO per share estimate for the upcoming report has changed -23.2% over the past month to $0.68. This represents a change of +195.7% from what the company reported a year ago. Outfront Media currently has a Zacks Rank of #3 (Hold).
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Life Storage, Inc. (LSI) : Free Stock Analysis Report
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