Unlocking Value: A Deep Dive into National Storage Affiliates Trust's Financial Resilience
Evaluating the Credit Profile of National Storage Affiliates Trust: An Overview
Our in-depth examination focuses on National Storage Affiliates Trust, analyzing its financial standing to assign a credit rating aligned with Moody's rigorous standards. This assessment will illuminate the company's fiscal strengths and any existing leverage-related considerations.
Robust Portfolio and Asset Security: NSA's Strategic Foundation
National Storage Affiliates Trust boasts a diverse portfolio comprising 1,069 properties spread across 37 states. A significant portion, 70%, of these assets remains unencumbered, providing substantial financial flexibility. Furthermore, the trust's market-adjusted asset coverage ratio stands at an impressive 271%, underscoring the solid backing for its obligations.
Addressing Leverage and Enhancing Credit Quality: The Financial Balancing Act
Despite its strong market presence and diversified asset base, NSA's credit quality faces constraints due to elevated leverage, indicated by a net debt-to-EBITDA ratio of 8.33. Additionally, the combined total of debt and preferred stock represents 61% of its total assets. These factors are crucial in understanding the current Baa3 credit rating.
Preferred Share Performance and Investor Yields: Opportunities in Fixed Income
Currently, NSA's preferred shares are trading below their par value, presenting an intriguing opportunity for investors. Specifically, NSA.PR.B offers a yield to worst approaching 7%, highlighting its potential attractiveness for those seeking fixed-income returns with a favorable risk-reward profile.