CubeSmart (CUBE) — CUBE stock looks like a good choice for long-term investors at current levels. This real estate investment trust (REIT) owns, operates and acquires self-storage facilities in the United States.
In the first quarter alone, CubeSmart acquired 11 new properties in major markets and had four properties pending. And it reported Q1 adjusted funds from operations (FFO) increased 14.3% to 32 cents per share.
The REIT is scheduled to announce results for its second quarter in early August with the consensus expecting a 17% year-over-year increase in FFO to 35 cents per share. CubeSmart has met or exceeded analysts’ estimates in each of the past 12 quarters.
Going forward, analysts at S&P Capital IQ Equity Research are encouraged by the strong demand expected in the storage industry and CubeSmart’s push into hard-to-enter markets like New York City.
Turning to the chart, CUBE stock has enjoyed a steady advance since breaking from a rectangle in October 2014 at about $19. Its bullish support line has consistently provided support during the run, which has taken shares more than 65% higher. Even when CUBE stock broke the bullish support line in February, it bounced from its 200-day moving average and quickly regained momentum.
My proprietary internal indicator, the Collins-Bollinger Reversal (CBR), triggered buy signals in April and mid-May, indicating that higher prices were in store.
As I mentioned, CUBE stock is best suited for long-term investors seeking income as opposed to traders. CubeSmart recently increased its quarterly dividend 31% to 21 cents per share for a current yield of 2.7%. The next dividend will be paid on July 15 to shareholders of record on July 1.
Try to buy CUBE stock on a pullback below $31. Shares should be capable of a run to $35, which would result in a gain of at least 13%, plus dividends.
