Polaris: ATVs, Cycles and Snowmobiles

12/13/2017 5:00 am EST

Focus: TRANSPORTATION

Leo Fasciocco

Investment Columnist and Publisher, Ticker Tape Digest

With annual revenues of $4.5 billion, Minnesota-based Polaris Industries (PII) makes off road vehicles and snowmobiles; technicvally, the stock has just broken out to the upside, notes Leo Fasciocco, editor of Ticker Tape Digest.

Its powersports vehicles include All-Terrain Vehicles and side-by-side vehicles for recreational and utility use. The company  also produces motorcycles and work and transportation and military vehicles. It sells motorcycles under Indian motorcycles and Slingshot brands.

Quarterly earnings growth will show an acceleration. That is very bullish. Net for the fourth quarter is expected to rise 26% to $1.48 a share from the $1.18 the year before.


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Then in the first quarter of next year, net should leap 36% to $1.02 a share from the 75 cents the year before. PII has topped the Street quarterly estimate the past four quarters by 24 cents a share, 8 cents, 5 cents and 3 cents.

The stock sells with a price-earnings ratio of 26. We see that as reasonable. Looking out to 2018, the Street is projecting a 17% increase in net to $5.66 a share from the anticipated $4.85 this year.

Technically, the stock climbed from around $90 back in August and has since broken out above $129.We are targeting the stock for a move to the $160 per share level off of its recent price breakout. A protective stop can be placed near $122.

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