An undersupply of self-storage space and solid demand is driving rising store revenue and the net asset value of Lok’nStore’s (LOK) portfolio higher. The lack of capacity has meant rising prices and occupancy rates, prompting management to expand the portfolio via acquisitions, with a conservative loan-to-value ratio giving the group ample firepower to continue buying and opening new stores and drive further net asset value (NAV) growth.
IC TIP:
Buy
at
642p
Tip style
Growth
Risk rating
Medium
Timescale
Long Term
Bull points
Rising occupancy
Low debt
Solidly rising NAV
Lack of UK self-storage capacity
Bear points
Risk of housing transaction downturn
Shares trade at premium to NAV