Sunstone Hotel Investors Inc (SHO) fair value: what the stock is really worth
We calculate from audited financials what Sunstone Hotel Investors Inc is really worth. The fair value tells you whether the price is too high or too low, the quality score (0 to 100) how solid the business behind it is. 26 models, 37 quality factors, updated daily, free.
Compare price with fair valuebelow fair value = cheap, above = expensive
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Real Estate · US · Market cap $2.1B · ISIN US8678921011
At a glance
SHSunstone Hotel Investors IncSHO · US
Price$10.97
Fair Value$2.31
Upside−78.9%
Quality53/100
A solid business, but trading 375% above our fair value of $2.31.
As of Sep 5, 2026, the fair value of Sunstone Hotel Investors Inc is $2.31 per share against a price of $10.97, so the fair value sits 79% below the price. A model estimate from reported figures, not an analyst target.
!Mixed Growth (revenue 5y +29.1 %/yr)
!Thin margins · 3.8% net margin
✓Low debt · generates free cash flow
·3.28% dividend yield
!Trails peers (5/15)
!Narrow moat 29/100
!Weak on past: 8 out of 100
Evidence: HighRange $2.31 to $4.85
Fair value as of: Sep 5, 2026
From 16 valuation models · updated 6 days ago
Share price +3.1% over the past month.
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What matters now
The price sits above even our optimistic bull case ($4.85). The favourable scenario is already priced in.
Solid but not exceptional quality (53/100) and above fair value, neither a clear bargain nor a standout compounder.
A fairly wide model range ($2.31 to $4.85) leaves room in how you read the outcome.
As a real-estate business, asset- and dividend-based methods carry more weight here than a standard DCF.
Price vs Fair Value (5 years)
White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Sep 5, 2026.
How to read this chart
60‑month range $7.42 – $11.92 · fair‑value band $2.31 – $4.85 · the $10.97 price screens above the $2.31 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Sep 5, 2026.
Sunstone Hotel Investors Inc (SHO) currently trades at $10.97, while our model-based Fair Value estimate is $2.31, implying the stock looks roughly 374.8% overvalued today. The Quality Score stands at 53/100 (solid quality), in the Real Estate sector. Bull case: the Asset-Based group reads highest at a median of $6.99 per share, and 2 of the 16 models we run sit above the $10.97 price. Bear case: the Growth DCF group reads lowest at $1.64, and 14 of the 16 models stay below the price. Evidence for this calculation is high.
Over the trailing twelve months, Sunstone Hotel Investors Inc generated revenue of $986M at a net margin of 3.8%. Revenue grew 11.0% year over year. It earns a return on equity of 1.9%. Net debt stands at $816M. Fundamentals as of Sep 5, 2026
Scenario range: $2.31 (bear) to $4.85 (bull), the price of $10.97 sits above it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target. The share trades about 9% below its 52-week high and 33% above its 52-week low, currently above its 200-day average. For context, the median of 10 Real Estate peers we cover trades at −28% fair-value upside, at −79%, SHO screens richer than that median.
Fair Value models
Each model values the company its own way; the fair value above is the evidence-weighted blend. Evidence (0 to 100) shows how complete a model's inputs are. How we calculate →
Note: the current price implies far more future growth than the conservative anchors of our models allow (base growth is deliberately capped, we do not regard such extreme rates as sustainable). Our models are not designed for expectations this high; that is why the individual models scatter extremely ($0.8800 to $14.76). Read the values as a conservative anchor, not as a price target.
ModelBear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target.Evidence
Highest evidence
Residual Income best evidence$7.13$6.73$4.9476
5Y EBITDA Exit$5.39$12.55$20.9172
FCF DCF$0.1900$2.51$5.8870
All 16 models by family
DCF Models
FCF DCF$0.1900$2.51$5.8870
5Y Revenue Exitn/a$1.61$4.2469
5Y EBITDA Exit$5.39$12.55$20.9172
10Y Revenue Exitn/a$1.55$4.0964
10Y EBITDA Exit$3.38$8.96$16.4664
Dividend Discount
Gordon GGM$4.07$8.12$12.2967
DDM Multi-Stage$4.07$6.54$8.5766
Multiples
P/S Multiple$1.68$2.24$2.8058
P/B Multiple$1.68$2.24$2.8055
EV/EBIT$2.29$4.50$6.7163
EV/EBITDA$9.99$14.76$19.5466
EV/Revenuen/a$0.8800$2.4550
Asset-Based
NCAV (Graham)$5.22$6.99$10.4454
Growth DCF
Growth DCF$0.2600$2.31$5.1170
Rev-Margin DCFn/a$1.64$4.0669
Economic Profit
Residual Income best evidence$7.13$6.73$4.9476
Widest divergence: Asset-Based ($6.99) versus Growth DCF ($1.64). Highest evidence: Residual Income (76).
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Key figures & financial health
P/E ratio99.7
P/S ratio2.55P/E × margin
EPS (TTM)$0.1100price ÷ EPS = P/E 99.7
Dividend yield3.3%
Net margin2.6%FY2025
Return on equity1.9%TTM
More key figures
Profitability
Return on assets (EBIT)1.8%avg 5y
Operating margin10.9%TTM
Growth
Revenue (TTM)$986MTTM
Revenue growth (YoY)+11.0%3y avg +1.7%
EPS growth (YoY)+11.7%
Balance sheet & cash flow
Free cash flow$78.7MFY2025
Net debt$816MFY2025 · ≈ 10.4 yrs of FCF
Figures from reported company fundamentals · as of Sep 5, 2026. TTM = trailing twelve months.
Quality Score breakdown
Overall quality53/100
Of which business quality 53
· Market factors (momentum, volatility) 61
Profitability16
Margins and returns on capital today
Quality Growth36
Are margins and returns improving?
Cashflow57
Earnings quality: real cash, not paper profit
Fin. Strength49
Balance sheet, leverage, solvency risk
Investment84
Disciplined investing over empire-building
Low Volatility72
Calm price path (market factor)
Momentum53
Price trend over the last 3–12 months (market factor)
52W Momentum64
Distance to the 52-week high (market factor)
Net Issuance100
Buybacks instead of dilution
Non-valuation factor families (profitability, growth, cashflow, financial strength, momentum …), each academically grounded. Valuation itself sits in the Fair Value and is deliberately excluded here to avoid double-counting.
All values are scores from 0 to 100 (100 = best against fixed, research-based bands), not percentages. The three market factors (momentum, 52-week proximity, low volatility) are displayed but carry zero weight in the headline number: market sentiment is not a business property.
About the company
Sunstone Hotel Investors, Inc. is a lodging real estate investment trust that, as of date of this release, owns 14 hotels comprised of 7,000 rooms. The majority of which are operated under nationally recognized brands.
Full company description
Sunstone Hotel Investors, Inc. is a lodging real estate investment trust that, as of date of this release, owns 14 hotels comprised of 7,000 rooms. The majority of which are operated under nationally recognized brands. Sunstone's strategy is to create long-term stakeholder value through the acquisition, active ownership, and disposition of well-located hotel and resort real estate. Sunstone Hotel Investors, Inc. was incorporated in 1995 and is based in Aliso Viejo, United States.
Company description, as reported by the company or data provider.
Revenue & earnings trend
FY2021 – FY2025 · reported fiscal years
Sunstone Hotel Investors Inc reported revenue of $960M in FY2025 versus $509M in FY2021, a compound +17.2%/yr. Reported net income was $24.6M in FY2025, compounding −8.0%/yr from FY2021.
Growth Quality 90/100
Revenue is growing, but margins or cash flow do not fully confirm the trend.
Latest Revenue (FY 2025)
$960M
Latest YoY
+6.0%
Avg. revenue growth/yr (3Y) ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+1.7%
Avg. revenue growth/yr (5Y) ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+29.1%
Avg. revenue growth/yr (24Y) ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump.
+6.2%
Value creation/yr (5Y) ⓘEarnings growth per share (CAGR 5 years, EBIT basis) plus dividend yield: value created per share and year.
−10.1%
Earnings growth per share plus dividend yield: the value created per share and year.
Earnings growth per share−13.4%
Dividend yield3.3%
Trend ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.5Y −19.8% vs 10Y −14.8%, flattening
Operating margin (EBIT) ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.−91.1% (2020) → 7.8% (2025) · rising
Worst earnings drop269% (2020) (loss year, drop beyond 100%) · in USD
⚠ Revenue per share shrinking 2.1%/yr over ~10Y (margins eroding too) ⓘStructural-decline marker: revenue PER SHARE has fallen over the last decade (robust median trend, not a single year). Backtested across 2005 to 2017, such businesses trailed the market by about 2.5 percentage points per year. Display only: it does not change the fair value or the quality score.
Revenue+17.2%/yr
FY21$509M
FY22$912M
FY23$986M
FY24$906M
FY25$960M
Net income−8.0%/yr
FY21$34.3M
FY22$87.3M
FY23$207M
FY24$43.3M
FY25$24.6M
Character of growth · EPS growth decomposed (2014-2025)−7.5 % p.a.
Revenue per share−2.3 %
of which total revenue −2.5 % · buybacks/dilution +0.2 %
EBIT margin−4.3 %
Tax rate−0.1 %
Residual (interest, one-offs)−0.9 %
Annual growth per factor. These are factors, not summands: multiplied they give the EPS growth rate, added they do not quite. Start and end points are 3-year averages (details on hover).
For bloggers, editors and developers: paste this into your site or blog (a “Custom HTML” block in WordPress), it shows the current fair value and links back here. Free, plain HTML, and welcome. Full data streams (CSV/JSON) at /developers.
How this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.
Valuation
Quality Score54 · Above median
Fair Value upside−79% · Bottom 25%
Profitability
Return on equity (TTM)2% · Above median
Return on assets2% · Below median
Net margin (TTM)4% · Above median
Operating margin (TTM)11% · Below median
Growth and dividend
Revenue growth11% · Top 25%
Dividend yield (TTM)3.3% · Below median
Balance sheet
Debt / equity0.47× · Below median
Valuation Multiples vs REIT - Hotel & Motel median · lower = cheaper
P/E (TTM)99.7× · Priciest 25%
P/B1.14× · Pricier than median
P/S (TTM)2.24× · Pricier than median
P/FCF28.1× · Priciest 25%
EV/EBITDA13.5× · Priciest 25%
PEG3.00× · Pricier than median
What the price implies (reverse DCF)
The inverse question: what free-cash-flow growth must Sunstone Hotel Investors Inc deliver for ten years so that today's price is fair in our DCF model? Same formula, same discount rate as the fair value.
Implied FCF growth, 10 years+16.5 % per year
Achieved revenue growth, 5 years+29.1 % p.a.
Sector median revenue growth+1.5 %
FCF yield on price3.69 %
Discount rate (WACC) in the models9.7 %
The price demands less growth than the company recently delivered: even a weaker business would justify the price. Ranking of the largest stocks →
Five quick dimensions, each 0 to 100: VALUE (fair-value potential), FUTURE (revenue growth), PAST (return on equity), HEALTH (low debt), DIVIDEND (yield). Green = this stock, grey = typical sector peer.
This stockSector peers
VALUE0· sector 8
FUTURE55· sector 7
PAST8· sector 5
HEALTH76· sector 73
DIVIDEND66· sector 89
VALUE 0: the price sits above our fair-value range.
Values & ESG
Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.
None of the checked exposures detected
Similar stocks
10 more REIT - Hotel & Motel stocks, each showing price versus our Fair Value estimate (as of Sep 5, 2026).
Is Sunstone Hotel Investors Inc (SHO) overvalued or undervalued?
As of Sep 5, 2026, our model estimates a fair value of $2.31 versus a price of $10.97, about −79% upside (overvalued).
What is the fair value of SHO?
Our model-based fair value for Sunstone Hotel Investors Inc is $2.31 (as of Sep 5, 2026), built from audited fundamentals. The current price: $10.97.
What is the quality score of SHO?
Sunstone Hotel Investors Inc has a Quality Score of 53/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for Sunstone Hotel Investors Inc (SHO)?
Our model-based price target is the fair value of $2.31 (as of Sep 5, 2026) from 16 valuation models. Cautious scenario $2.31, optimistic scenario $4.85. It is a calculation from audited fundamentals, not an analyst target.
What is the Sunstone Hotel Investors Inc stock forecast for 2026?
Our models put fair value at $2.31, about −79% upside versus a price of $10.97 (overvalued). Cautious scenario $2.31, optimistic scenario $4.85. The calculation is refreshed regularly with new filings.
What is the revenue of Sunstone Hotel Investors Inc (SHO)?
Sunstone Hotel Investors Inc reported trailing-twelve-month revenue of about $986M (latest available figure, as of Sep 5, 2026).
What is the net profit margin of SHO?
The net profit margin of Sunstone Hotel Investors Inc is about 3.8%, meaning it keeps roughly 3.8% of revenue as net income. Based on the latest reported figures.
Does Sunstone Hotel Investors Inc pay a dividend?
Sunstone Hotel Investors Inc currently shows a dividend yield of about 3.28% relative to its recent price (as of Sep 5, 2026).
What growth is priced into Sunstone Hotel Investors Inc (SHO)?
For today's price to be fair in a discounted-cash-flow model, Sunstone Hotel Investors Inc would have to grow free cash flow by +16.5 % per year for ten years (discount rate 9.7 %, then 2 % perpetual growth). Over the last 5 years revenue grew +29.1 % per year. As of Sep 5, 2026.
What discount rate (WACC) does the fair value of SHO use?
Our models discount Sunstone Hotel Investors Inc at 9.7 %: a base by market capitalisation (mid), damped by beta 0.99, country premium for USA. The same rate applies in all 26 models.
What is the intrinsic value of Sunstone Hotel Investors Inc (SHO)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For Sunstone Hotel Investors Inc it is $2.31 per share (as of Sep 5, 2026), against a price of $10.97. It is the blended result of 16 valuation models (cash flow, earnings, asset, dividend).
Is Sunstone Hotel Investors Inc stock overvalued or undervalued in 2026?
As of Sep 5, 2026, SHO trades above its calculated fair value: price $10.97, fair value $2.31, a gap of about −79% (overvalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of SHO?
No. The price is what the market pays today ($10.97); the fair value is what the company's own numbers justify ($2.31). For Sunstone Hotel Investors Inc the two are $8.66 per share apart. That gap is exactly why we show both numbers side by side.
How much is Sunstone Hotel Investors Inc worth?
The market values Sunstone Hotel Investors Inc at about $2.1B (market capitalisation, as of Sep 5, 2026). Per share that is $10.97; our models calculate a fair value of $2.31 per share.
What do the bullish and bearish scenarios say about SHO?
Our models span a range for Sunstone Hotel Investors Inc: cautious scenario $2.31, base $2.31, optimistic $4.85 per share (as of Sep 5, 2026, price $10.97). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of SHO?
Sunstone Hotel Investors Inc trades at a price-to-earnings ratio of 99.7 (as of Sep 5, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of $2.31 is built from several models across several years. Other multiples: PEG 3.0, P/B 1.1, P/S 2.2, EV/EBITDA 13.5.
What is the PEG ratio of SHO?
The PEG ratio of Sunstone Hotel Investors Inc is 3.00 (P/E divided by earnings growth, as of Sep 5, 2026). That is above 1, so the growth is already paid for in the price.
How solid is the balance sheet of Sunstone Hotel Investors Inc (SHO)?
Balance-sheet figures for Sunstone Hotel Investors Inc (as of Sep 5, 2026): return on equity 1.9%, debt of 0.47 per unit of equity. They feed the Quality Score of 53/100, which measures business quality independently of the share price.
How far is SHO from its 52-week high?
Sunstone Hotel Investors Inc trades at $10.97, about 9% below its 52-week high of $12.07 and 33% above the low of $8.23 (as of Sep 5, 2026). Distance from the high says nothing about value: that is what the fair value of $2.31 is for.
Which stocks are comparable to Sunstone Hotel Investors Inc?
From the same area (Real Estate) we also value Host Hotels & Resorts, Inc, Ryman Hospitality Properties, Inc, COVH, Apple Hospitality REIT, Inc, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is Sunstone Hotel Investors Inc stock attractive at the current price?
The data as of Sep 5, 2026: price $10.97, calculated fair value $2.31 (−79%), Quality Score 53/100, from 16 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of SHO calculated?
We run Sunstone Hotel Investors Inc through 16 models from four families: discounted cash flow, earnings models, asset and balance-sheet models, and dividend models. Every model gets the same audited fundamentals; the result is the weighted average of $2.31, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 32.6 % above its aggregate fair value. Sunstone Hotel Investors Inc itself currently trades above fair value. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on <a href="/is-it-worth-investing-now/">is it worth investing now</a>.
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Sunstone Hotel Investors Inc
SHO · US