ABP spiked higher in February after announcing a possible $3bn spin-off of its Storage King business into a listed property trust which would theoretically help the company unlock some decent intrinsic value. ABP trades on 14.3x while its larger rival in the self-storage space, National Storage REIT (NSR) trades on 21.8x. Like many REITs, ABP has been trading at a heavy discount to its asset values making the move both logical and attractive hence we like ABP as a cheap, high yielding sleeping giant in the MM portfolio.
- We believe ABP is becoming cheap with it now trading on a 14.3x valuation for FY23 while being forecast to yield around 7% over the next 12 months i.e. it trades ex-dividend in June.
- Technically contrarian chartists would be looking for a break under $2.40 to start accumulating but we should be conscious that the dividend could be the reason it trades to fresh 2023 lows.
MM likes ABP into current weakness
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