Sun International (SUI.JO)

Consumer · JSE · South Africa

R50.72-8.25% today

Fundamentals

Market capR12.41B

P/E ratio7.8

Dividend yield9.74%

Revenue growth (YoY)+3.3%

Profit margin12.5%

Return on equity50.9%

52-week rangeR36.19 to R56.65

Valuation and ratings

DCF fair valueR56.10

Upside to fair value+10.6%

Analyst target (mean)R62.35

Analyst rangeR59.70 to R65.00

Analysts covering2

Consensus viewstrong buy

Moat score67/100

Overall rating68/100, Buy

Sun International trades at R50.72, close to the R56.10 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.

Our moat model scores it 67 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.

It changes hands at 7.8 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.

About Sun International

Sun International Limited owns and operates casino, hotel, and resort properties in South Africa. It offers management services for businesses in the hotel, resort, casino, and gambling industry. The company is also involved in the gaming route operation and related activities; and online sports betting and gaming business. Sun International Limited was founded in 1966 and is headquartered in Sandton, South Africa.

Industry: Resorts & CasinosHQ: South Africa

SUI.JO passes 4 of our 30 screens today

Each screen prints the exact criteria it used, and the circumstances in which it is wrong.

Quality at a fair price

Good businesses, not cheap ones. A wide moat and a strong rating, at a multiple that has not run away.

Consumer staples

The companies that sell what people buy regardless of the economy. Dull, and dull is the entire point.

South Africa and the JSE

A commodity and currency market wearing an equity market's clothes. The index can rise on a good day in Beijing.

Dividend aristocrats

Companies with long, unbroken records of raising their dividend. The record is the point: it is evidence, not a promise.

Common questions

Is Sun International (SUI.JO) undervalued?

Against our discounted cash flow estimate of R56.10, SUI.JO at R50.72 is 11% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.

What is SUI.JO's P/E ratio?

SUI.JO trades at 7.8 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.

The full research page for SUI.JO, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.

Open SUI.JO in the app Free guides and screens

Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.