A recreational vehicle maker has drawn Real Money Columnist Paul Price's eye.
“Polaris (PII) designs, engineers and manufactures all-terrain vehicles, snowmobiles, motorcycles and boats. These items and their accessories are distributed and sold through dealers in the U.S., Canada and Europe," Price wrote recently. "Global adjacent markets in other areas, accounting for about 6% of sales, are served via local retailers."
In addition, "despite supply chain disruptions during 2021, full-year results finished with all-time record sales and earnings for Polaris.”
Just how good was 2021 for this company? In a nutshell:
- PII raised its dividend to 64 cents per quarter, making it a market leader for income stocks;
- The company’s adjusted EPS beat analysts’ estimates at $9.13 for 2021 and a forward guidance (that is, an estimate) of $10.10 - $10.40 for 2022;
- Sales have tripled over the past nine years;
- Cash flow has increased by 141 percent (not a typo) and EPS grew by 107.5 percent.
These are some great numbers, yet at time of writing the stock was trading for “a below average multiple” writes Price, while “delivering an above typical current yield.”
“Continuous shareholders made money since the end of 2012, but nowhere near as much as would have been expected. That's because right now you can own PII for $51.07 per share, less (-32%) than it fetched at its November of 2014 peak of $159.30."
He adds that "fundamentals are way better now than back in 2014 across all major metrics. That implies a substantial ‘catch-up’ move higher is well overdue.”
