National Storage Affiliates Trust Boosts Quarterly Dividend 3.6%, Share Price Hits New All-Time High (NSA)
By: Ned Piplovic,
National Storage Affiliates Trust (NYSE: NSA) will increase its quarterly dividend 3.6% at the end of June 2018, its seventh quarterly dividend increase in just the last 13 quarters.
In addition to the rapid pace of dividend growth, the company’s share price has been growing at an equally fast rate, having risen more than 20% over the past year amid a string of new all-time highs. Over the past three years, the total return between dividend income and stock price appreciation is well into the triple-digit-percentage range.
A large driver of this recent growth is the trend of home and apartment downsizing, which has created significant demand for off-site storage. As one of the largest self-storage facility owners and operators in the United States, National Storage Affiliates’ strategy has been to establish a significant presence in all of the top 100 Metropolitan Statistical Areas (MSAs), which positions the company well to meet increased demand both now and in the future.
National Storage Affiliates’ next ex-dividend date is on June 14, 2018. The pay date will follow the ex-dividend date by approximately two weeks and is set for June 29, 2018.
National Storage Affiliates Trust (NYSE:NSA)
Formed in 2013 and based in Greenwood Village, Colorado, National Storage Affiliates is a self-administered, self-managed real estate investment trust (REIT) whose primary focus is the acquisition, ownership and operation of self-storage facilities. The company operates and expands through ongoing contributions from its Participating Regional Operators (PROs), third party acquisitions and joint venture partnerships. Since its formation in 2013 by three self-storage operators that collectively owned 100 properties, the REIT has added five additional operators and expanded its property base more than five-fold. As of May 31, 2018, NSA had ownership interests in and operated 551 self-storage properties in 29 states, with more than 250,000 individual storage units with a combined rentable space of approximately 34 million square feet. Out of the 551 total facilities, the trust wholly owns 479 locations. The remaining 72 locations are owned through joint ventures. According to the 2016 Self-Storage Almanac, NSA is the sixth-largest owner and operator of self-storage facilities in the United States.
With the upcoming quarterly dividend distribution, the REIT is set to hike its quarterly payout 3.6% from the previous period’s $0.28 per share to $0.29 per share. On an annual basis, a $0.29 dividend converts to $1.16, or a forward dividend yield of 4%. While the yield has been lowered by the recent robust share price growth, NSA”s current 4% yield is 29% higher than the 3.1% average yield of the overall Financials sector and 9% higher than the 3.65% simple average yield of all the company’s peers in the Industrial REITs market segment.
With approximately bi-annual quarterly dividend increases for the last three years, the company has advanced its total annual dividend payout by over 100% — from $0.54 in 2015 to a forward annual payout of $1.16 with the upcoming dividend hike.
Despite an overall very positive share price trajectory since its inception, the REIT saw greater amounts of volatility over the last year. The share price entered the trailing 12-month period on a downtrend and declined over 10% before hitting its 52-week low of $21.17 on August 18, 2017. However, the share price reversed direction after that, recovered all its losses over the following 30 days and continued to rise well above the $27 level until near the end the year. NSA had another big slide in January and February 2018, but has since recovered and has been setting new all-time highs at the end of every trading session since May 30. On June 5, the share price closed $29.34, which was 23% higher than one year earlier and 124% above the share price level from three years ago.
In conclusion, this self-storage REIT has been generous to its shareholders, both in rising dividend income and share price appreciation, thanks to an excellent growth strategy that plays into an ongoing trend. Over the past three years, the total return on investment was almost 150%.
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Ned Piplovic is the assistant editor of website content at Eagle Financial Publications. He graduated from Columbia University with a Bachelor’s degree in Economics and Philosophy. Prior to joining Eagle, Ned spent 15 years in corporate operations and financial management. Ned writes for www.DividendInvestor.com and www.StockInvestor.com.