ASX:NSR
National Storage REIT
Investment Summary
The fund managers believe that National Storage REIT (NSR) is undervalued, having been initiated as a position due to its share price trading significantly below historical norms. In their opinion, NSR offers an attractive investment opportunity as it exhibits a 17% discount to NTA, a rare occurrence in its history. They cite substantial growth in NTA/S by 43% and storage footprint by 63%, reinforcing the business model's resilience. Moreover, the fund managers expect future dividend growth driven by management's strategic balance of rates and occupancy. They are optimistic about the development pipeline and asset recycling opportunities with partners like GIC, which could enhance returns. Increased corporate interest in the Australian self-storage sector further supports their positive outlook on NSR.
Commentary From The Managers
Endeavor Asset Management
31 Mar 2025
$2.22
- Endeavor Asset Management initiated a position in National Storage REIT (NSR) following significant share price weakness in March.
- NSR is recognized as a national leader in the Australian self-storage industry.
- The investment was made as NSR was trading at an attractive 17% discount to NTA, an occurrence seen only twice in its history.
- The fund manager expects management to balance rates and occupancy growth sustainably.
- Endeavor anticipates a growing dividend stream from NSR moving forward.
- There is potential upside in NSR's development pipeline.
- Endeavor sees value in NSR's ability to recycle existing assets alongside its investment partner, GIC.
- Heightened corporate interest in the Australian self-storage sector is viewed positively, although the fund does not rely on takeover activity to justify investments.
Ten Cap
31 Mar 2025
$2.22
- Ten Cap initiated a position in National Storage REIT (NSR) due to perceived overselling of the business.
- NSR was trading at 2 standard deviations below its historical premium to NTA.
- The current price is significantly below the pre-COVID bid price of $2.40.
- Despite these valuations, NSR has shown growth in NTA/S by 43%.
- The storage footprint has expanded by 63%, highlighting growth prospects.
- Ten Cap appreciates the business model of storage and anticipates near-term tailwinds with housing turnover rebound.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.