Extra Space Storage to Report Q2 Earnings: What to Expect From It?

Extra Space Storage EXR, a leading self-storage real estate investment trust (REIT) in the United States, is set to release its second-quarter 2025 results on July 30, after market close. The company’s quarterly results are likely to display a year-over-year rise in revenues and no change in funds from operations (FFO) per share.In the last reported quarter, this Salt Lake City, UT-based REIT delivered a surprise of 2.04% in terms of core FFO per share. The results reflected higher revenues due to growth in occupancy. However, high interest expenses during the quarter were a spoilsport.Over the trailing four quarters, the company beat the Zacks Consensus Estimate on all occasions, with the average surprise being 1.88%. The graph below depicts this surprise history:Extra Space Storage Inc Price and EPS Surprise Extra Space Storage Inc price-eps-surprise | Extra Space Storage Inc QuoteFactors to Consider and Projections for EXRIn the second quarter, Extra Space Storage is likely to have continued benefiting from high brand value and significant scale. The company’s focus on consistently growing its business and achieving geographical diversity through accretive acquisitions is likely to have aided higher revenue generation for the quarter under consideration.Moreover, the self-storage asset category is need-based and recession-resilient in nature. This asset class has low capital expenditure requirements and generates high operating margins. Additionally, the self-storage industry continues to benefit from favorable demographic changes. All these factors cumulatively are likely to have contributed to the company’s top-line growth.The Zacks Consensus Estimate of $716.45 million for quarterly property rental revenues suggests an increase from the year-ago period’s $697.1 million. The consensus estimate for revenues from tenant insurance of $86.35 million implies an increase from $83.71 million reported in the year-ago period. Moreover, the consensus mark for management and franchise fees for the quarter is projected at $31.52 million, marginally up from $29.86 million in the year-ago period.The Zacks Consensus Estimate of $835.79 million for quarterly revenues suggests a 3.1% increase year over year.However, EXR operates in a highly fragmented market in the United States, with intense competition from numerous operators. This has fueled competition, affecting its power to raise rents and turn on more discounting, impacting its second-quarter earnings. Further, high-interest expenses are expected to have cast a pall on the company's performance to some extent.We estimate a 4.9% year-over-year jump in interest expenses in the second quarter.Extra Space Storage’s activities during the quarter were not adequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly core FFO per share has remained unchanged at $2.06 over the past two months. Also, it indicates no change compared to the year-ago reported figure.What Our Quantitative Model Predicts for EXROur proven model does not conclusively predict a likely surprise in terms of core FFO per share for Extra Space Storage this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is not the case here.Extra Space Storage currently has an Earnings ESP of 0.00% and carries a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Stocks That Warrant a LookHere are two stocks from the broader REIT sector — AvalonBay Communities AVB and Cousins Properties CUZ— that you may want to consider, as our model shows that these have the right combination of elements to report a surprise this quarter.AvalonBay Communities, scheduled to report quarterly numbers on July 30, has an Earnings ESP of +0.02% and carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.Cousins Properties, slated to release quarterly numbers on July 31, has an Earnings ESP of +0.36% and carries a Zacks Rank of 3 at present.Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.5% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AvalonBay Communities, Inc. (AVB): Free Stock Analysis Report Cousins Properties Incorporated (CUZ): Free Stock Analysis Report Extra Space Storage Inc (EXR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks