Sun Communities (SUI) AI Stock Analysis

• Market Cap: $15.84B
• Dividend Yield: 3.03%
• Average Volume (3M): 699.27K
• Price to Earnings (P/E): 196.3
• Beta (1Y): 0.38
• Revenue Growth: -6.88%
• EPS Growth: -45.29%
• Country: US
• Employees: 6,491
• Sector: Real Estate
• Sector Strength: 56
• Industry: REIT - Residential
• EPS (TTM): -0.34
• Shares Outstanding: 127,641,660
• 10 Day Avg. Volume: 726,106
• 30 Day Avg. Volume: 699,273
• PEG Ratio: -11.81
• Price to Book (P/B): 2.25
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 25.19
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 1.30
• Enterprise Value/Gross Profit: 10.93
• Enterprise Value/Ebitda: 3.88
• 1Y Price Target: $137.86
• Price Target Upside: 13.99% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 70 Outperform
• Price Target: $136.00 ▲( 12.45% Upside)

Sun Communities presents a strong financial and operational foundation with positive cash flow, but faces challenges with high leverage and low profit margins. The strategic sale of Safe Harbor Marinas and a stable technical outlook are positive, but the high valuation remains a concern. The stock is supported by strategic moves and dividend yield, but careful consideration of macroeconomic impacts is necessary.

Positive Factors

Debt Reduction

The Company is planning to use the proceeds primarily for debt reduction, resulting in a pro forma net debt/EBITDA ratio expected to be within 2.5-3.0x, down from current levels of 6.0x.

Financial Performance

Sun Communities, Inc. increased its price objective to $132 to reflect an improved balance sheet following smart capital allocation decisions with the Safe Harbor sale proceeds.

Occupancy Rates

Sun Communities, Inc. reported a stronger performance in the manufactured housing sector with improved occupancy rates, reaching 99% across its MH and RV portfolios.

Negative Factors

Earnings Guidance

The 2025 FFO guidance came in below consensus and a penny below BofA.

RV Business Pressure

The transient RV business at Sun Communities, Inc. remains under pressure due to normalization after increased travel post-COVID and general macroeconomic uncertainty.

Valuation Concerns

The analyst reiterates an Underperform rating based on valuation concerns, CEO uncertainty, and risks associated with the RV and UK markets.

Sun Communities Business Overview & Revenue Model

Company Description

Sun Communities, Inc. (SUI) is a real estate investment trust (REIT) that specializes in the ownership and operation of manufactured housing communities, recreational vehicle (RV) resorts, and marinas. The company, founded in 1975 and headquartered in Southfield, Michigan, focuses on providing affordable housing and vacation accommodations across the United States and Canada. Sun Communities is recognized for its well-maintained properties and commitment to offering quality living experiences for its residents and guests.

How the Company Makes Money

Sun Communities generates revenue primarily through the leasing of land and facilities to residents in its manufactured housing communities and RV resorts. The company earns rental income from homeowners who lease the land on which their manufactured homes are placed, as well as from RV owners who pay for short-term or long-term site rentals. Additionally, Sun Communities derives income from selling homes within its communities and providing various services, such as utilities and amenities, to residents and guests. The company also operates marinas, generating revenue from slip rentals and related services. Strategic acquisitions and development projects further contribute to Sun Communities' earnings by expanding its portfolio and enhancing its service offerings. Partnerships with homebuilders and RV manufacturers, alongside a strong focus on customer service and property management, play significant roles in maintaining steady income streams.

Sun Communities Financial Statement Overview

Summary

Sun Communities shows steady revenue growth and strong operational performance with solid EBIT and EBITDA margins. However, the net profit margin and return on equity are low, and high leverage poses financial risk. Strong cash flow generation adds stability, but improvements in profitability are needed.

Income Statement

Sun Communities shows steady revenue growth with a TTM revenue of $2.99 billion, although there has been a slight decline from the previous year. The gross profit margin remains strong at 47.7% in the TTM period. However, the net profit margin is relatively low at 2.56%, indicating challenges in converting revenue into net income. Both EBIT and EBITDA margins show solid profitability at 17.26% and 35.2%, respectively, providing a stable operational performance.

Balance Sheet

The company's balance sheet reflects a high debt-to-equity ratio of 1.06, suggesting significant leverage, which could pose financial risk. Return on equity is modest at 1.11%, indicating limited profit generation from shareholders' equity. However, the equity ratio stands at 41.93%, showing a reasonable proportion of equity financing compared to total assets, which adds some stability.

Cash Flow

Operating cash flow is robust at $862.4 million, contributing positively to a strong free cash flow. The operating cash flow to net income ratio stands at 11.24, highlighting a strong cash-generating ability relative to net income. The free cash flow to net income ratio is also robust, demonstrating effective cash management, although there has been minimal growth in free cash flow compared to previous periods.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.00B	3.20B	3.18B	2.93B	2.26B	1.39B
	Gross Profit
1.43B	1.50B	1.49B	1.42B	1.15B	774.22M
	EBIT
517.60M	522.60M	1.22B	588.00M	462.76M	293.03M
	EBITDA
1.06B	1.10B	771.60M	2.27B	1.68B	1.26B
	Net Income Common Stockholders
76.70M	89.00M	-213.30M	242.00M	380.20M	131.61M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
97.40M	47.40M	29.20M	217.70M	265.10M	223.02M
	Total Assets
16.51B	16.55B	16.94B	17.08B	13.49B	11.21B
	Total Debt
7.35B	7.35B	7.78B	9.33B	5.67B	4.69B
	Net Debt
7.25B	7.31B	7.75B	9.24B	5.59B	4.59B
	Total Liabilities
9.48B	9.36B	9.77B	9.20B	6.76B	5.58B
	Stockholders Equity
6.92B	7.08B	7.08B	7.81B	6.62B	5.53B
Cash Flow		Free Cash Flow
862.40M	861.00M	790.50M	1.60B	472.37M	1.07B
	Operating Cash Flow
862.40M	861.00M	790.50M	734.90M	753.57M	548.95M
	Investing Cash Flow
-167.70M	-267.40M	-919.50M	-3.06B	-2.34B	-2.49B
	Financing Cash Flow
-716.90M	-571.60M	80.30M	2.35B	1.57B	2.00B

Sun Communities Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 120.94
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SUI, the sentiment is Negative. The current price of 120.94 is below the 20-day moving average (MA) of 121.56, below the 50-day MA of 121.52, and below the 200-day MA of 123.34, indicating a bearish trend. The MACD of 0.37 indicates Negative momentum. The RSI at 48.93 is Neutral, neither overbought nor oversold. The STOCH value of 58.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SUI.

Sun Communities Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CPT	73 Outperform	$16.85B	109.28	2.47%	3.48%	0.56%	-73.40%
SUI	70 Outperform	$15.84B	196.33	1.44%	3.03%	-6.88%	-45.29%
UDR	70 Outperform	$13.91B	117.52	3.40%	4.06%	2.35%	-73.89%
ELS	68 Neutral	$13.09B	34.96	22.87%	2.98%	0.69%	5.67%
UMH	65 Neutral	$1.44B	154.18	3.45%	5.05%	8.01%	―
Sector *	60 Neutral	$2.82B	10.38	0.33%	8508.19%	5.98%	-17.49%
ESS	60 Neutral	$19.10B	27.42	12.09%	3.45%	7.61%	27.83%

Sun Communities Corporate Events

Sun Communities Holds Annual Shareholders Meeting

Sun Communities held its Annual Meeting of Shareholders on May 13, 2025, where shareholders voted on several key proposals. The election of nine directors was confirmed, with each director set to serve until the 2026 Annual Meeting. Additionally, shareholders approved the non-binding advisory vote on executive compensation, ratified the selection of Grant Thornton LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, and approved an amendment to extend the term of the company’s 2015 Equity Incentive Plan to December 31, 2035.

The most recent analyst rating on (SUI) stock is a Buy with a $147.00 price target. To see the full list of analyst forecasts on Sun Communities stock, see the SUI Stock Forecast page.

Sun Communities Sells Safe Harbor Marinas to Blackstone

On April 30, 2025, Sun Communities, Inc. completed the initial closing of the sale of its Safe Harbor Marinas business to an affiliate of Blackstone Infrastructure for approximately $5.25 billion. This transaction aligns with Sun’s strategy to focus on its core MH and RV portfolio, enhancing its financial flexibility and leverage profile. The proceeds will be used to repay debt, fund future acquisitions, and return capital to shareholders through a special cash distribution and a stock repurchase program. The company also announced plans to redeem $950 million of outstanding unsecured senior notes and declared a special one-time cash distribution of $4.00 per share.

Sun Communities Appoints New Chief Accounting Officer

On March 17, 2025, Sun Communities, Inc. announced the appointment of Brian Loftus as the Senior Vice President and Chief Accounting Officer. Loftus, who has a strong background in financial leadership roles across various industries, will report to the company’s CFO, Fernando Castro-Caratini. This appointment is part of the company’s strategic efforts to strengthen its financial operations. Loftus’s extensive experience, including his previous roles at Unique Fabricating, Inc., Wabash National Corporation, and Horizon Global Corporation, positions him well to contribute to Sun Communities’ continued growth and financial management.

Sun Communities Sells Safe Harbor Marinas for $5.65B

Sun Communities, Inc. announced the sale of its Safe Harbor Marinas to Blackstone Infrastructure for $5.65 billion, aiming to refocus its business strategy on its core MH and RV operations. The transaction is expected to significantly de-leverage Sun’s balance sheet, enhance financial flexibility, and generate an estimated book gain of approximately $1.3 billion, benefiting shareholders and reinforcing the company’s focus on durable annual income streams.

Sun Communities Sells Safe Harbor Marinas for $5.65B

On February 24, 2025, Sun Communities announced the sale of its Safe Harbor Marinas business to Blackstone Infrastructure for $5.65 billion. This strategic move allows Sun to refocus on its core MH and RV segments, enhancing its financial flexibility and leverage profile. The transaction is expected to generate approximately $5.5 billion in pre-tax proceeds, which will be used for debt reduction, shareholder distributions, and reinvestment in core businesses. The sale is anticipated to close in the second quarter of 2025, subject to customary conditions, and is expected to significantly improve Sun’s balance sheet and financial metrics.