Sun Communities Inc (NYSE:SUI): A Prime Candidate for the "Decent Value" Screen

For investors looking for chances in underpriced companies, the "Decent Value" screening method gives a structured way to find stocks priced below their real worth while keeping good basic qualities. This method centers on securities with good valuation numbers, typically scoring above 7 on valuation ratings, while still showing acceptable results in earnings, financial stability, and growth areas. This kind of balanced basic strength helps reduce the dangers often linked to very cheap investments, where companies could seem inexpensive for valid business causes. By focusing on both good prices and operational quality, this method tries to find companies set for possible price gains as market awareness matches the real business value.

Fundamental Analysis Overview

Sun Communities Inc (NYSE:SUI) presents a strong case based on its detailed fundamental analysis report, reaching an overall rating of 6 out of 10. The real estate investment trust, which focuses on manufactured housing and recreational vehicle communities in the United States, Canada, and the United Kingdom, shows special ability in valuation numbers while keeping acceptable scores in other basic categories. When measured against 20 industry peers in the Residential REITs sector, Sun Communities displays a balanced profile that fits well with value investment standards, mixing good pricing with lasting business activities.

Valuation Metrics

The company's valuation profile is notable as especially strong for value-focused investors, scoring 7 out of 10 in this important area. Several numbers show possible underpricing compared to both industry peers and wider market indices:

• Price-to-Earnings ratio of 12.33 compares well against industry average of 51.16
• Enterprise Value to EBITDA ratio places the company less expensive than 95% of industry competitors
• Price/Free Cash Flow ratio ranks more appealing than 95% of sector peers
• Current P/E ratio sits well below S&P 500 average of 27.76

These valuation numbers indicate the market may be valuing Sun Communities at a lower price than its real value, a main point for value investors who look for companies trading below their calculated worth. The mix of several valuation signs pointing the same way makes the case for possible underpricing stronger.

Financial Health Assessment

With a health rating of 7 out of 10, Sun Communities shows good financial stability that gives a safety buffer for value investors. The company's balance sheet displays special ability in liquidity numbers, with both current and quick ratios greatly above industry averages:

• Current Ratio of 4.21 shows strong short-term bill payment ability
• Quick Ratio of 3.81 does better than 100% of industry competitors
• Debt-to-Equity ratio of 0.56 means careful borrowing compared to sector peers
• Debt to FCF ratio of 5.45 is one of the industry's top performers

This financial base lowers failure risk and gives operational room, key points for value investors who focus on protecting money along with return possibility. The company's getting better debt-to-assets ratio also shows a good direction in financial management.

Profitability Profile

Sun Communities keeps an acceptable profitability rating of 6 out of 10, showing steady profit creation in spite of some earnings pressures. The company displays ability in returns on money while having difficulties in some earnings categories:

• Return on Assets of 9.69% does better than all industry peers
• Return on Equity of 16.89% is more than 95% of competitors
• Profit Margin of 46.59% is first in the whole industry
• Operating Margin of 18.46% is equal to sector middle performance

While gross earnings have gone down in recent times and are behind 90% of industry competitors, the company's good returns on invested money and steady profitability over the last five years give proof of lasting earnings ability, an important factor for value investors judging business quality.

Growth Trajectory

With a growth rating of 5 out of 10, Sun Communities shows a varied but hopeful growth view that might add to its underpricing. The company displays strong past revenue growth together with expected earnings speed-up:

• Revenue has increased at 20.57% each year over recent years
• EPS expected to rise by 47.07% each year in coming years
• Recent EPS growth of 1089.53% over past year shows operational betterment
• PEG ratio shows inexpensive valuation relative to growth expectations

The expected earnings growth speed-up, mixed with acceptable revenue increase, suggests the company may be set for better results, possibly creating a gap between current valuation and future outlook that value investors often look for.

Investment Considerations

For investors using a value-focused method, Sun Communities stands for an interesting case where good valuation numbers meet acceptable basic strength across several areas. The company's lower pricing compared to industry peers, mixed with good financial health and getting better profitability directions, makes a profile that fits with traditional value investment standards. The REIT's focus on necessary housing and recreational properties gives some protective qualities, while its operational betterments and growth prospects offer possible triggers for valuation awareness.

The screening process that found Sun Communities keeps finding possible chances for investors looking for underpriced companies with good basics. More screening results using similar value-centered standards can give more investment ideas for review.

Disclaimer: This analysis is for information only and does not make up investment advice, suggestion, or support of any security. Investors should do their own study and talk with financial advisors before making investment choices. Past results do not ensure future outcomes, and all investments have risk including possible loss of original money.