September 7, 2023
Top 10 Stock Safestore Buy Recommendation

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For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).

360° View: Obermatt 360° View Safestore Buy

360 METRICS	September 7, 2023
VALUE
VALUE	32
GROWTH
GROWTH	17
SAFETY
SAFETY	78
SENTIMENT
SENTIMENT	91
360° VIEW
360° VIEW	58

ANALYSIS: With an Obermatt 360° View of 58 (better than 58% compared with alternatives), overall professional sentiment and financial characteristics for the stock Safestore are above average. The 360° View is based on consolidating four consolidated indicators, with half below and half above average for Safestore. The consolidated Sentiment Rank has a good rank of 91, which means that professional investors are more optimistic about the stock than for 91% of alternative investment opportunities. It also rates well regarding its financing structure, with the consolidated Safety Rank at 78 or better than 78% of its peers when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the stock is expensive and expects low growth. The consolidated Value Rank is only 32, meaning that the share price of Safestore is on the high side, compared with indicators such as revenues, profits, and invested capital. The company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth,and stock returns, with its Growth Rank at 17. ...read more

RECOMMENDATION: With a consolidated 360° View of 58, Safestore is better positioned than 58% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, namely the positive professional market sentiment (Sentiment Rank of 91) and safe financing practices (Safety Rank of 78), the case for investing in this stock needs further thought. The Value and the Safety Ranks are below average. The Safety Rank is the least critical of the four consolidated ranks, because it only reflects financing practices. So the question is: How to assess below-average value against above-average sentiment? This may be a case where growth is in the future, not yet reflected in current performance. Companies that might fall into this category are those with intellectual property, such as technology and pharmaceutical companies. In early phases, they are expensive relative to their size and have a lot of capital on their books, as is the case here. Investors expect a better future and are willing to pay a higher price than is warranted by the current company size. These higher prices drive stock price value down in the short term. In this case, future growth may be the strongest driver of the investment case, reflected by institutional investors' opinions. With a weak Value Rank, the question is how much to sacrifice value at the cost of positive sentiment. Sometimes market sentiment is just hype, but sometimes it is right. You pay more than market-average for this stock, but it may be worth it, if the future of Safestorẹ is bright. Prudent investors may only want to invest a smaller portion of their wealth in such situations. Young investors can carry more risk but should still thrive for sufficient diversification. ...read more

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Sentiment Strategy: Professional Market Sentiment for Safestore very positive

SENTIMENT METRICS	September 7, 2023
ANALYST OPINION
ANALYST OPINION	72
OPINIONS CHANGE
OPINIONS CHANGE	44
PRO HOLDINGS
PRO HOLDINGS	90
MARKET PULSE
MARKET PULSE	89
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	91

ANALYSIS: With an Obermatt Sentiment Rank of 91 (better than 91% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Safestore is very positive. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for Safestore. Analyst Opinions are at a rank of 72 (better than 72% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 90, which means that currently, professional investors hold more stock in this company than in 90% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 89 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 89% of competitors). But Analyst Opinions Change has a below-average rank of 44, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in Safestore. ...read more

RECOMMENDATION: With a consolidated Sentiment Rank of 91 (more positive than 91% compared with investment alternatives), Safestore has a reputation among professional investors that is significantly higher than that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...read more

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Value Strategy: Safestore Stock Price Value below-average critical

VALUE METRICS	September 7, 2023
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	30
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	37
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	31
DIVIDEND YIELD
DIVIDEND YIELD	51
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	32

ANALYSIS: With an Obermatt Value Rank of 32 (worse than 68% compared with alternatives), Safestore shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Safestore. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 51% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 30 which means that the stock price compared with what market professionals expect for future profits is higher than 70% of comparable companies, indicating a low value concerning Safestore's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 37 which means that the stock price compared with what market professionals expect for future profit levels is higher than 63% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 31 is also low. Compared with invested capital, the stock price is higher than for 69% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 32, is a hold recommendation based on Safestore's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Safestore? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Safestore only if they reasonably expect the low current profit levels to be transitory. ...read more

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Growth Strategy: Safestore Growth Momentum negative

GROWTH METRICS	September 7, 2023
REVENUE GROWTH
REVENUE GROWTH	23
PROFIT GROWTH
PROFIT GROWTH	60
CAPITAL GROWTH
CAPITAL GROWTH	16
STOCK RETURNS
STOCK RETURNS	41
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	17

ANALYSIS: With an Obermatt Growth Rank of 17 (better than 17% compared with alternatives), Safestore shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for Safestore. While Profit Growth has a good rank of 60, as professionals currently expect the company to grow its profits more than 60% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 23, which means that currently professionals expect the company to grow less than 77% of its competitors, while Capital Growth has a rank of 16 and Stock Returns have been below market median, with a rank of 41 (59% of alternative investments were better). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 17, is a sell recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. ...read more

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Safety Strategy: Safestore Debt Financing Safety very solid

SAFETY METRICS	September 7, 2023
LEVERAGE
LEVERAGE	73
REFINANCING
REFINANCING	50
LIQUIDITY
LIQUIDITY	70
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	78

ANALYSIS: With an Obermatt Safety Rank of 78 (better than 78% compared with alternatives) for 2023, the company Safestore has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Safestore is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for Safestore. Leverage is at 73, meaning the company has a below-average debt-to-equity ratio. It has less debt than 73% of its competitors. Refinancing is at a rank of 50, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 50% of its competitors. Finally, Liquidity is also good at a rank of 70, which means that the company generates more profit to service its debt than 70% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 78 (better than 78% compared with alternatives), Safestore has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more

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Combined financial peformance: Safestore Lowest Financial Performance

COMBINED PERFORMANCE	September 7, 2023
VALUE
VALUE	32
GROWTH
GROWTH	17
SAFETY
SAFETY	70
COMBINED
COMBINED	24

ANALYSIS: With an Obermatt Combined Rank of 24 (worse than 76% compared with investment alternatives), Safestore (REITs: Specialized, United Kingdom) shares have lower financial characteristics compared with similar stocks. Shares of Safestore are low in value (priced high) with a consolidated Value Rank of 32 (worse than 68% of alternatives) and show below-average growth (Growth Rank of 17) but are safely financed (Safety Rank of 78), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 24, is a sell recommendation based on Safestore's financial characteristics. As the company Safestore's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 32) and low growth (Obermatt Growth Rank of 17), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 78) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. ...read more

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