Stifel Nicolaus has maintained its Buy rating on SmartStop Self Storage (SMA), highlighting the REIT’s resilient occupancy rates and disciplined capital allocation. The firm points to sustained demand in the self-storage sector as a key driver of long-term value.
- SMA’s Q3 2025 occupancy rate: 93.8%
- Return on invested capital (ROIC): 14.2%
- Acquisition cap rate: 6.8%
- Dividend payout ratio: 68% of FFO
- Average rental rate increase: 5.7% YoY
- Stifel Nicolaus maintains Buy rating
Stifel Nicolaus has reaffirmed its Buy rating on SmartStop Self Storage (SMA), emphasizing the company’s operational resilience amid evolving market conditions. The firm cited SMA’s 93.8% occupancy rate as of Q3 2025 as a strong indicator of demand stability in the self-storage segment, outpacing the industry average of 91.2% during the same period. This performance reflects effective leasing strategies and a diversified tenant base across 19 states. The firm also underscored SMA’s capital efficiency, noting a 14.2% return on invested capital (ROIC) for the trailing twelve months. This metric, above the 12.5% benchmark for peer REITs in the sector, underscores disciplined investment decisions and strong asset management. Stifel highlighted the company’s ability to execute targeted acquisitions at a 6.8% cap rate, reinforcing its position as a value-driven operator in a consolidating market. Market reaction has been positive, with SMA shares rising 2.3% in early trading following the report. The move is expected to influence investor sentiment toward specialty REITs, particularly those focused on essential, non-cyclical real estate. Analysts suggest that SMA’s strategy of focusing on high-growth urban markets—where average rental rates increased 5.7% year-over-year—positions it favorably for sustained revenue growth. Investors monitoring the broader real estate sector may view SMA’s rating as a signal of confidence in the self-storage asset class, especially as inflation pressures ease and interest rates stabilize. The REIT’s commitment to dividend sustainability, with a payout ratio of 68% of funds from operations (FFO), further supports its appeal in a yield-seeking environment.