Wolfe Research downgraded shares of Public Storage (NYSE: PSA) from Outperform to Peerperform on Monday, signaling a more cautious near-term view of the self-storage real estate investment trust's stock performance. At the time of the announcement the shares were changing hands at $282.63 and the company's price-to-earnings ratio stood at 29.49.
The downgrade reflects Wolfe Research's expectation that investor returns may be limited in the near term despite the potential for stronger results further out. The firm noted in its research communication: "We think there is potential for meaningfully better earnings growth in 2027, but believe company shares could pause for some time until this growth is more apparent." Wolfe Research did not alter its prior price target when issuing the rating change.
Investment-data referenced alongside Wolfe's action indicates some downward revisions to analyst forecasts for the upcoming period. According to InvestingPro data cited in the coverage, two analysts have trimmed their earnings estimates for Public Storage in the near term.
Public Storage, a REIT and one of the largest U.S. owners and operators of self-storage facilities, reported third-quarter 2025 financial results earlier in its reporting cycle. The company posted adjusted earnings per share of $2.62, coming in above the $2.53 analysts had been expecting - a positive surprise of approximately 3.56%.
However, revenue for the quarter missed projections, with reported sales of $948.93 million versus the $1.22 billion that had been anticipated, representing roughly a 22.22% shortfall. Market commentary from sell-side firms attributed the EPS outperformance primarily to tight expense management rather than top-line strength.
Broker reactions to the quarter have been varied. RBC Capital highlighted that strong expense control drove the earnings beat but remained cautious enough to keep a Sector Perform rating and reduce its price target to $307. Truist Securities moved its price target to $315 from $320 while raising its own earnings estimates and keeping a Buy rating on the shares. Morgan Stanley resumed coverage of Public Storage with an Equalweight rating, emphasizing the firm's robust balance sheet and income density.
Taken together, recent corporate results and analyst moves illustrate a mixed reception from the market and research community: solid margin execution offset by weaker-than-expected revenue, prompting both price-target revisions and shifts in coverage stance. For investors and market watchers focused on REITs and real estate-related equities, these developments signal caution about near-term upside alongside acknowledgement of potential longer-term earnings improvement.
Summary
Wolfe Research downgraded Public Storage to Peerperform despite forecasting better earnings growth in 2027; the stock trades at $282.63 with a P/E of 29.49. The company's Q3 2025 results combined an EPS beat with a substantial revenue miss, and multiple analysts have updated their views and price targets.