Big Yellow Group has outstanding track record, says Investec

Big Yellow Group’s target to double its earnings by 2022 doesn’t look overly ambitious given its “outstanding” track record of growth, according to Investec on Monday.

Investec issued an ‘add’ rating and target price of 834p to the self-storage company’s stock ahead of its third quarter results on Tuesday.

“We forecast a three-year earnings per share and dividend per share compound annual growth rate of 12.2% driven by further occupancy and rental growth,” said Investec analyst Alison Watson.

“Meanwhile the business model’s non-reliance on the capital cycle (i.e. yield compression) is particularly attractive at this point in the property cycle.”

Investec predicts earnings per share of 30.9p in the full-year 2016, rising to 34.7p in 2016 and 38.4p in 2018, implying 42% growth over three years.

Shares fell 2.54% to 20.50p at 1317 GMT.