CubeSmart: Buy For Dividend Growth From Self Storage

Dec. 17, 2024 2:27 AM ETCubeSmart (CUBE) StockEXR, PSA, NSA, SELF
Compounding Chef profile picture
Compounding Chef
45 Followers
(15min)

Summary

  • CubeSmart is an efficient manager of self-storage property, the demand for which is driven by the 4 Ds: Dislocation, Divorce, Downsizing, and Death.
  • The company has proven to be a profitable property manager and asset allocator, creating significant value for shareholders.
  • I rate CubeSmart a Buy, as I view it as a stable investment with the potential for double-digit CAGR.
  • Risks include overbuilding in the sector, PE capital infusion, and interest rate risk.

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Introduction

CubeSmart (NYSE:CUBE) is a real estate investment trust focused on self-storage properties across the United States. In addition to leasing out their own storage units, CubeSmart has built a significant revenue stream from managing self-storage

This article was written by

Compounding Chef profile picture
Compounding Chef
45 Followers
Compounding Chef combines a business education background with professional experience in a variety of industries to find opportunities across the investing universe including… Media, Marketing, and Public Relations Travel, Tourism, Hospitality, Corporate Events, and Software as a Service. I have been managing the growth of personal and family assets for 15 years with the goal of building wealth that compounds for multiple generations. While I occasionally find short term opportunities in undervalued assets or special situations, I make an investment with the intent to buy and hold for 10 years or longer. I believe in the power of letting one’s winning ideas compound for years by… Reinvesting the growing dividends from well managed organizations, balancing current income with sustainable growth, seeking opportunities with substantial margin of safety and a wide moat, and taking advantage of short term fear to buy great assets at fair prices. My best ideas have been in REITs and dividend growth stocks, combining fundamental analysis with reasonable expectations of future cash flows. I do not seek to get rich quickly but build wealth that lasts. As a general rule for asset location, I look to hold dividend growth stocks in a taxable brokerage account and I use a Roth IRA for REIT and BDC investments.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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