On Tuesday, Goldman Sachs (NYSE:GS) adjusted its stance on Big Yellow (OTC:YELLQ) Group Plc (BYG:LN) (OTC: BYLOF), downgrading the stock from Buy to Neutral. The firm also revised the price target to £14.50 from the previous £15.20. This change comes after the company's shares experienced a notable increase in value since mid-December last year.
The downgrade was influenced by the company's performance relative to the UK and European real estate market. According to the firm, Big Yellow Group (LON:BYG) has outperformed its coverage sector by approximately 5% year-to-date. The firm's analysts acknowledge that their initial investment thesis has been realized, citing positive like-for-like rental growth as evidence of strong demand for storage units.
Despite the downgrade, the company's shares have seen a significant rise of around 12.7% since being added to Goldman Sachs' Buy List on December 14, 2022. This increase is compared to the FTSE World Europe's approximate 13% gain and the coverage sector's rise of about 6.3% over the same timeframe.
Goldman Sachs' revised earnings per share (EPS) estimates for Big Yellow Group for the years 2024 to 2028 now reflect a decrease of 3% to 1%. This adjustment is partly due to a slight reduction in the long-term occupancy trend assumption. The revised estimates take into account recent occupancy trends and management commentary provided by the company.
The firm's decision to alter the stock's rating and price target is based on the performance metrics and trends observed, without any additional commentary or speculation on future market movements or company strategy.
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