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Sovran Self Storage

The real estate investment trust is slated to report second-quarter earnings on Aug. 1. Analysts, on average, anticipate earnings of 78 cents a share on revenue of $55.66 million.

"Sovran Self Storage, Inc. (SSS-NYSE) reported a strong 1Q beat and management tweaked full-year FFO guidance higher by 1.5% at the midpoint," KeyBanc Capital Markets analysts wrote in a May 2 report. "We expect the stock to modestly outperform on the results, which should put upward pressure on Street estimates given the higher NOI run-rate to start off the year. In addition to lower expenses stemming from the warmer winter, SSS was able to increase occupancy to 82.7% at the end of the quarter, representing a 340 basis point increase year-overyear. As a result, management's bullish comments last quarter regarding the potential to achieve 87% occupancy during this year's peak leasing season may not be as far out of reach as we may have thought. Since 2004, the average increase in occupancy from the 1Q to the 3Q has been 240 basis points, which would comfortably place SSS's occupancy above 85%, well in excess of our current estimate. Year-to-date the stock has outperformed the self storage sector (+430 bps) and the RMS (+1,130 bps). SSS trades at 20x our 2012 AFFO estimate, representing an 8% discount to the sector and a 13% discount to the REIT weighted average. We reiterate our HOLD rating."

Forward Annual Dividend Yield: 3.5%

Stewart Enterprises

The funeral company reported second-quarter earnings from continuing operations on June 6 of $9.6 million, or 11 cents a share, down from year-earlier earnings of $10.2 million, or 11 cents a share.

"We reiterate our Buy investment rating on the shares as we are encouraged that management continues to take actions to increase shareholder value," Davenport analysts wrote in a June 8 report. "Also, STEI has a dividend yield of 2.4% which we see as attractive. In our view, 2H'12 funeral volumes should pick up and make way for easier comps, which could provide some upside to our numbers. We would also expect STEI earnings to increasingly benefit from the recent sales realignment and workforce reduction."

Forward Annual Dividend Yield: 2.2%

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-- Written by Alexandra Zendrian

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