Analyst John Kim of BMO Capital maintained a Buy rating on Sun Communities (SUI – Research Report), with a price target of $139.00.
John Kim has given his Buy rating due to a combination of factors surrounding Sun Communities’ strategic financial decisions. The company announced the sale of its marina portfolio to Blackstone for $5.65 billion, a significant increase from the initial acquisition cost of $3.8 billion. This transaction is expected to simplify earnings and reduce general and administrative expenses, thereby improving the company’s financial health.
Furthermore, the sale is anticipated to lead to multiple expansion, as it will result in a cleaner balance sheet. The transaction, set to close in the second quarter of 2025, is valued at a 21.0x multiple based on the estimated 2024 funds from operations. This strategic move positions Sun Communities favorably for future growth and stability, justifying the Buy rating.
Kim covers the Real Estate sector, focusing on stocks such as Prologis, Federal Realty, and AvalonBay. According to TipRanks, Kim has an average return of 0.6% and a 47.98% success rate on recommended stocks.