Raymond James Ratings Upgrade Pointing to “multiple avenues driving robust demand for Canadian self storage space,” Mr. Sturges also raised his rating for Storagevault Canada Inc. (SVI-X -0.22%decrease
) to “outperform” from a “market perform” recommendation, suggesting it could generate “strong” organic growth in 2021.
“Despite reduced foreign immigration levels in Canada as a result of COVID-19 restrictions, multiple other demand drivers have improved StorageVault’s lead generation and leasing activity for its self storage facilities,” he said. “Some of these drivers include increased home renovation and general housing transactional activity, greater non-discretionary demand (i.e. the 6 D’s), remote working and learning, and higher commercial tenant demand. With a greater focus on increasing penetration rates with the millennial cohort, StorageVault’s increased pricing power can drive strong organic growth year-over-year in 2021.”
Mr. Sturges raised his target for the Toronto-based company’s shares to $5.25 from $4.50. The average is $4.86.
“We are upgrading StorageVault ... to reflect: 1) the company’s strong lead generation and leasing activity that can capture accelerating demand fundamentals for Canadian self storage space, supporting a runway for StorageVault to generate robust NAV/share growth year-over-year in the coming quarters; and 2) StorageVault’s improved relative valuation to its US storage peers, as its relative premium has somewhat narrowed recently,” he said.