Key Factors to Impact Public Storage Stock in Q3 Earnings

Core Viewpoint - Public Storage (PSA) is expected to report third-quarter 2024 results on October 30, with anticipated revenue growth but a potential decline in core funds from operations (FFO) per share [1][2]. Group 1: Financial Performance - The last reported quarter showed PSA's quarterly revenues at $1.17 billion, reflecting a 4.8% year-over-year increase, while core FFO per share declined by 1.2% [1]. - The Zacks Consensus Estimate for the upcoming quarterly revenues is $1.18 billion, indicating a 3.44% year-over-year increase [3]. - The self-storage industry is experiencing a softening in demand, with same-store revenues likely affected and a projected weighted average square foot occupancy of 92.8%, down from 93% in the prior quarter [4][5]. Group 2: Market Position and Strategy - Public Storage benefits from a strong presence in major urban markets, a well-established brand, and technological advantages, which are expected to support its financial position [2]. - The company has acquired 240 facilities with 17 million net rentable square feet for $3.4 billion from early 2022 to June 30, 2024, and has ongoing developments expected to add 3.8 million net rentable square feet at an estimated cost of $738.7 million [3]. Group 3: Challenges and Outlook - High interest rates are anticipated to increase interest expenses by 20.5% year-over-year in the third quarter [5]. - The Zacks Consensus Estimate for core FFO per share has been revised down to $4.25, indicating a 1.85% year-over-year decline [5]. - Despite these challenges, the company holds a Zacks Rank of 3 and an Earnings ESP of +0.67%, suggesting a potential surprise in FFO per share [6].