Is Extra Space Storage, Inc. overvalued or undervalued?

As of 3 October 2025, the valuation grade for Extra Space Storage, Inc. moved from fair to expensive, indicating a shift towards overvaluation. The company appears overvalued based on its P/E ratio of 35, which is significantly higher than the peer average of approximately 31.82, and its PEG ratio of 4.16, suggesting that growth expectations are not justified by current earnings. Additionally, the EV to EBITDA ratio stands at 14.71, which is also elevated compared to peers like VICI Properties, Inc., which has a more attractive EV to EBITDA of 9.70.
In terms of performance, Extra Space Storage has underperformed against the S&P 500 over the past year, with a return of -18.99% compared to the index's 17.82%, and a similar trend is observed over three years, where it returned -17.73% against 82.57% for the S&P 500. This underperformance, combined with high valuation ratios, reinforces the conclusion that Extra Space Storage, Inc. is overvalued in the current market environment.