Financial Survey: Sun Communities (SUI) vs. Silver Bay Realty Trust (SBY)

Sun Communities (NYSE: SUI) and Silver Bay Realty Trust (NYSE:SBY) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, valuation, institutional ownership, profitability and analyst recommendations.

Insider and Institutional Ownership

93.7% of Sun Communities shares are held by institutional investors. Comparatively, 73.6% of Silver Bay Realty Trust shares are held by institutional investors. 4.2% of Sun Communities shares are held by insiders. Comparatively, 7.3% of Silver Bay Realty Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for Sun Communities and Silver Bay Realty Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sun Communities 0 1 5 0 2.83
Silver Bay Realty Trust 0 3 0 0 2.00

Sun Communities currently has a consensus price target of $92.00, suggesting a potential upside of 8.21%. Silver Bay Realty Trust has a consensus price target of $20.25, suggesting a potential downside of 5.77%. Given Sun Communities’ stronger consensus rating and higher probable upside, equities analysts plainly believe Sun Communities is more favorable than Silver Bay Realty Trust.

Valuation and Earnings

This table compares Sun Communities and Silver Bay Realty Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sun Communities $833.78 million 8.09 $31.32 million $0.74 114.89
Silver Bay Realty Trust N/A N/A N/A ($0.07) -307.00

Sun Communities has higher revenue and earnings than Silver Bay Realty Trust. Silver Bay Realty Trust is trading at a lower price-to-earnings ratio than Sun Communities, indicating that it is currently the more affordable of the two stocks.

Dividends

Sun Communities pays an annual dividend of $2.68 per share and has a dividend yield of 3.2%. Silver Bay Realty Trust pays an annual dividend of $0.52 per share and has a dividend yield of 2.4%. Sun Communities pays out 362.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Silver Bay Realty Trust pays out -742.9% of its earnings in the form of a dividend. Silver Bay Realty Trust has raised its dividend for 4 consecutive years.

Profitability

This table compares Sun Communities and Silver Bay Realty Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sun Communities 7.37% 2.76% 1.17%
Silver Bay Realty Trust -5.71% -1.42% -0.61%

Summary

Sun Communities beats Silver Bay Realty Trust on 11 of the 14 factors compared between the two stocks.

Sun Communities Company Profile

Sun Communities, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company is a fully integrated real estate company, which, together with its affiliates and predecessors, has been in the business of acquiring, operating, developing, and expanding manufactured housing (MH) and recreational vehicle (RV). As of December 31, 2016, it owned and operated or had an interest in a portfolio of properties located throughout the United States and Ontario, Canada, including 226 MH communities, 87 RV communities, and 28 properties containing both MH and RV sites. The Company operates through two segments: Real Property Operations and Home Sales and Rentals. The Real Property Operations segment owns, operates, or has an interest in a portfolio, and develops MH communities and RV communities throughout the United States and is in the business of acquiring, operating, and expanding MH and RV communities.

Silver Bay Realty Trust Company Profile

Silver Bay Realty Trust Corp. is a real estate investment trust. It focuses on the acquisition, renovation, leasing and management of single-family properties in select markets in the United States. As of December 31, 2016, it had owned 9,044 single-family properties in Arizona, California, Florida, Georgia, Nevada, North Carolina, Ohio, South Carolina and Texas. Its investments in real estate consist of single-family properties located in various select markets, including Atlanta, Phoenix, Tampa, Charlotte, Orlando, Dallas, Jacksonville, Northern California, Las Vegas, Columbus, Tucson and Southeast Florida. The Charlotte market includes properties in South Carolina due to its proximity to Charlotte, North Carolina. The Northern California market consists of Contra Costa, Napa and Solano counties. The Southeast Florida market consists of Miami-Dade, Broward and Palm Beach counties. It conducts business and owns all of its properties through Silver Bay Operating Partnership L.P.

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