15 top stock picks from star investors

Public Storage
15 best stocks public storage

Brian Jones
Neuberger Berman Real Estate

Ticker: (PSA)

Sector pick: Real Estate

Brian Jones and Steve Shigekawa, managers of the $670 million Neuberger Berman Real Estate Fund (NBRFX), own just 40 stocks, with the top 10 representing nearly half the fund's assets. That strategy has served them well: The fund has landed an average annualized gain of 13.3% for the past 10 years, vs. 10.3% for the category, according to Morningstar.

Jones's favorite stock for 2013 is Public Storage, the largest self-storage company in the U.S., which represents more than 5% of the fund's assets. The REIT has a lot going for it. As the largest player in a fragmented market -- its 2,200 facilities are just 4% of the nation's 50,000 -- Public Storage has the financial strength and marketing clout that rivals lack. "They own more than twice as many self-storage facilities as their nearest competitor," Jones says.

The company boasts occupancy levels above 90%, which has helped Public Storage boost its rental rates. With the economics favoring big players and a dearth of financing for construction of storage spaces, the market is primed to consolidate, Jones says, and Public Storage should benefit.

--A.F.


- Last updated December 07 2012 12:34 PM ET
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