Morgan Stanley Initiated Coverage of Sun Communities (SUI) with an Equal Weight Rating
Morgan Stanley thinks there are several possible outcomes for the REIT and says Sun Communities' low debt gives it room to make new acquisitions. The company is in good financial shape, though it might be slightly overvalued based on its fair value. It also has a strong history, having paid dividends for 33 years straight, with a current yield of 3.32%.
The investment firm believes SUI will mainly focus on manufactured housing and recreational vehicle properties, with more attention on the former based on what management has shared. They also expect Sun Communities to work on making its current operations better by raising rental rates and running things more efficiently.
An aerial view of a REIT-developed multi-housing property.
In 2024, Sun Communities, Inc. (NYSE:SUI) worked on getting rid of assets that did not fit its core strategy and made its operations and finances simpler. This included selling its Safe Harbor marina business, while still keeping its properties in the UK.
Morgan Stanley analysts expect that Sun Communities might still sell its Park Holidays business, which they believe the market would see as a good move. However, with the company's improved debt position, it may not feel as much pressure to sell right away.
Sun Communities is a public REIT that owns and operates manufactured housing and RV communities. As of 2025, the REIT owns or holds a stake in 500 properties across the US, Canada, and the UK.
While we acknowledge the potential of SUI as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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