Goldman Sachs cut Public Storage (PSA) from its recommended list, and now rates the stock as market perform.
On Thursday the company posted $0.70 vs. $0.75 second quarter funds from operations per share despite a 7.6% revenue rise.
Analyst James Kammert says second quarter funds from operations salesforce missed the $0.77 consensus estimate by a wide margin. He says occupancy remains well below a year ago's level after two years of aggressive rent increases. Kammert expects a gradual recovery in occupancy through 2003. However, he cut his $3.18 2002 funss from operations share estimate to $2.81 and cut the $3.54 2003 to $3.07. He notes the company's dividend is sound, and that its cash of $172 million exceeds the $122 million in debt. He says he is downgrading given the anticipated price drop in the near term, and given the company's conservative earnings assumptions.