This week, we’ll start out with the most boring news.

U-Haul (UHAL) reported its results this week, and we saw the slowdown that probably most people anticipated… but it was a little worse than I expected. The challenge with all companies that go through a boom and bust cycle, like U-Haul did with the surge in one-way moves during the COVID/Work from Home years is that we can’t really know for sure what the longer-term growth trend will be.

One way to get around that is to look at the average results through a cycle, and UHAL is now trading at 23X their average net income over the past eight years… and about 11X their net income over the past four quarters. The average valuation for the company during the past decade has been about 13-16X earnings, lower recently because there was an awareness that 2022 was probably their peak earnings year.

There’s no real analyst input on this one, despite the fact that it’s a $10 billion company and by far the biggest brand name in the self-moving industry (and a leader in self-storage as well)… but it’s family-controlled, run for long-term returns, and still undervalued given the unmatched power of their network and their brand. We just have to accept, as long-term investors, that the stock will be both overvalued and undervalued sometimes, while the underlying business keeps building and compounding its value.

What we don’t know is what moving activity will be like over the next few years, or where demand for self storage will settle… we only know that they got windfall returns from all the one-way moving during the pandemic, and that’s not recurring right now, the level of business has dropped. It hasn’t disappeared, though, and we’re still on a long-term growth trend if we try to average out those two years of COVID-driven moving activity — we’re still well above 2019 levels. It could always get dramatically worse during a serious downturn or recession, but over multi-year periods they always end up growing eventually.

For the full year (their fiscal year ends in March), the moving equipment rental business revenues dropped by about 2% from 2022 levels, and self-storage grew 21%, mostly because they built more facilities (they increased their rentable square footage by 12%, occupancy dropped by about 1.5%). Full year net income dropped by about 18%, ...