Value
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 5.5 |
| P/S | 8.4 |
| EV/EBITDA | 6.1 |
| Fwd P/E | 7.9 |
| PEG | 5.5 |
| Analyst target | 4.0 |
- ▸Forward P/E: 15.4x
- ▸PEG: 1.37
SUNB · Why this verdict
Why Sunbelt Rentals Holdings (SUNB) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Sunbelt Rentals Holdings has strong momentum with a 7.2 out of 10 momentum score and 292% free cash flow conversion relative to net income, but the stock trades 15.4% above analyst targets and has only one quarter of earnings history showing a miss, limiting visibility into the fundamental earnings trajectory.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Sunbelt converts 292% of net income into free cash flow, meaning the business generates nearly three times as much cash as GAAP earnings suggest, which is a powerful indicator of earnings quality in a capital-intensive rental business. Quality breakdown | Free cash flow conversion remains above 200% of net income over the next 12 months, confirming the structural cash generation advantage persists. | →Stable |
| CounterAn FCF conversion of 292% may partly reflect non-cash depreciation on a large equipment fleet; if the company must reinvest heavily to maintain fleet age and capacity, the economic free cash flow may be lower than reported. | ||
The stock has a momentum score of 7.2 out of 10, rising on-balance volume, and is above all moving averages, suggesting accumulation by institutional buyers who may have visibility into rental market conditions not yet fully reflected in analyst targets. Momentum breakdown | The stock price remains above $80 and on-balance volume continues rising for at least 6 months, confirming that institutional accumulation supports the current price level. | →Stable |
| CounterThe stock is already 15.4% above analyst targets, which is a significant divergence; momentum without fundamental support from analyst upgrades often precedes a reversion to fair value. | ||
The stock trades at $83.62 while analyst consensus targets imply a price of approximately $70 based on the 15.4% overrun, indicating that the market has priced in a fundamentally more optimistic scenario than professional analysts currently model. Warnings | Analyst consensus price target rises above $87, exceeding the current stock price of $83.62, through upward revisions driven by positive business updates within 12 months. | →Stable |
| CounterSunbelt is a recent IPO-adjacent company with limited analyst coverage; targets may rapidly converge upward as more analysts initiate coverage with higher valuations based on peer comparisons. | ||
With only 1 quarter of available earnings history showing a miss of 7.1%, there is very limited data to assess management's ability to deliver on analyst forecasts in different economic conditions. Earnings | At least 3 additional quarters of earnings history become available within 12 months, with at least 2 of those quarters beating estimates, establishing a credible track record. | →Stable |
| CounterSunbelt operates in the equipment rental sector where large established peers provide clear industry benchmarks; even with limited history, the business model is well-understood by analysts who cover the space. | ||
Sunbelt converts 292% of net income into free cash flow, meaning the business generates nearly three times as much cash as GAAP earnings suggest, which is a powerful indicator of earnings quality in a capital-intensive rental business.
→StableQuality breakdown
- Expectation
- Free cash flow conversion remains above 200% of net income over the next 12 months, confirming the structural cash generation advantage persists.
CounterAn FCF conversion of 292% may partly reflect non-cash depreciation on a large equipment fleet; if the company must reinvest heavily to maintain fleet age and capacity, the economic free cash flow may be lower than reported.
The stock has a momentum score of 7.2 out of 10, rising on-balance volume, and is above all moving averages, suggesting accumulation by institutional buyers who may have visibility into rental market conditions not yet fully reflected in analyst targets.
→StableMomentum breakdown
- Expectation
- The stock price remains above $80 and on-balance volume continues rising for at least 6 months, confirming that institutional accumulation supports the current price level.
CounterThe stock is already 15.4% above analyst targets, which is a significant divergence; momentum without fundamental support from analyst upgrades often precedes a reversion to fair value.
The stock trades at $83.62 while analyst consensus targets imply a price of approximately $70 based on the 15.4% overrun, indicating that the market has priced in a fundamentally more optimistic scenario than professional analysts currently model.
→StableWarnings
- Expectation
- Analyst consensus price target rises above $87, exceeding the current stock price of $83.62, through upward revisions driven by positive business updates within 12 months.
CounterSunbelt is a recent IPO-adjacent company with limited analyst coverage; targets may rapidly converge upward as more analysts initiate coverage with higher valuations based on peer comparisons.
With only 1 quarter of available earnings history showing a miss of 7.1%, there is very limited data to assess management's ability to deliver on analyst forecasts in different economic conditions.
→StableEarnings
- Expectation
- At least 3 additional quarters of earnings history become available within 12 months, with at least 2 of those quarters beating estimates, establishing a credible track record.
CounterSunbelt operates in the equipment rental sector where large established peers provide clear industry benchmarks; even with limited history, the business model is well-understood by analysts who cover the space.
Per-dimension breakdown
Quality
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 6.0 |
| ROA | 4.5 |
| Gross margin | 10.0 |
| Op margin | 7.5 |
| Net margin | 6.3 |
| Current ratio | 4.1 |
| FCF quality | 10.0 |
| Moat | 5.8 |
| Rule of 40 | 5.5 |
| Piotroski F | 6.7 |
- ▸Excellent cash conversion: 292% FCF/NI
Growth
1.9/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.2 |
| EPS growth | 0.6 |
Momentum
1.4/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 2.5 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.8 |
| Analyst rating | 7.2 |
| Price target | 6.8 |
Insider
5.1/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.2 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.8 |
| quality rank | 7.1 |
| growth rank | 1.9 |
Technical
8.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 10.0 |
| support resistance | 9.6 |
| 52w position | 6.7 |
Risk (lower is worse)
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| days to cover | 8.8 |
| volatility | 0.4 |
| put call | 0.0 |
| implied vol | 5.2 |
| max pain risk | 3.0 |
| beta | 4.5 |
| debt equity | 4.3 |
| news risk | 6.0 |
- ▸Elevated put/call: 2.20
- ▸Above max pain $50
Catalyst
3.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| surprise avg | 0.0 |
| dividend safety | 6.0 |
| news activity | 8.0 |
- ▸Earnings concerns: 0B/2M
- ▸Dividend: 238.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.60
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:1.4<4.5
- ASYMMETRY:-0.2=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.19
Upside
-1.9%
Downside
9.7%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — Beta 1.65>1.3
Investment implication
The F-path SELL output reflects an overall score of 4.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Technical at 8.8) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:1.4<4.5, ASYMMETRY:-0.2=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.19 — supplementary context, not the trigger for this path.
The strongest dimensions are Technical at 8.8, Quality at 6.6, and Sentiment at 6.6; the weakest are Momentum at 1.4, Growth at 1.9, and Catalyst at 3.8. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.19 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Sunbelt converts 292% of net income into free cash flow, meaning the business generates nearly three times as much cash as GAAP earnings suggest, which is a powerful indicator of earnings quality in a capital-intensive rental business.
Trip ifFree cash flow conversion falls below 150% of net income, declining more than 140 percentage points from the current 292% level.
- P2The stock has a momentum score of 7.2 out of 10, rising on-balance volume, and is above all moving averages, suggesting accumulation by institutional buyers who may have visibility into rental market conditions not yet fully reflected in analyst targets.
Trip ifPrice drops below $70, more than 16% below the current $83.62, closing the gap with analyst consensus targets.
- P3The stock trades at $83.62 while analyst consensus targets imply a price of approximately $70 based on the 15.4% overrun, indicating that the market has priced in a fundamentally more optimistic scenario than professional analysts currently model.
Trip ifAnalyst consensus price target remains below $75 for more than 6 consecutive months, indicating analysts are not revising estimates upward to justify the current price.
- P4With only 1 quarter of available earnings history showing a miss of 7.1%, there is very limited data to assess management's ability to deliver on analyst forecasts in different economic conditions.
Trip ifEPS surprise falls below 0% in at least 2 of the next 3 quarters, revealing a pattern of missing estimates as more history accumulates.