RV Maker has big numbers, trading well past its all-time high

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An RV builder has caught real-money columnist Paul Price’s attention.

“Polaris (PII) designs, engineers and manufactures all-terrain vehicles, snowmobiles, motorcycles and boats. These items and their accessories are distributed and sold through resellers in the United States, Canada and Europe,” Price wrote recently. “Adjacent global markets in other regions, accounting for approximately 6% of sales, are serviced by local retailers.”

Additionally, “despite supply chain disruptions in 2021, the full year results ended with record sales and profits for Polaris.”

How good has 2021 been for this company? In a word:

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  • PII increased its dividend to 64 cents per quarter, making it a market leader in income stocks;
  • The company’s adjusted EPS exceeded analyst estimates of $9.13 for 2021 and a forecast (i.e. estimate) of $10.10 to $10.40 for 2022;
  • Sales have tripled over the past nine years;
  • Cash flow increased by 141% (not a typo) and EPS increased by 107.5%.

These are great numbers, but at the time of writing the stock is trading for “a lower than average multiple,” Price writes, while “offering an above average current yield.”

“Permanent shareholders have made money since the end of 2012, but not nearly as much as one would expect. This is because currently you can hold PII for 51.07 $ per share, down (-32%) from its November 2014 peak at $159.30.”

He adds that “fundamentals are much better today than in 2014 for all major indicators. This implies that a significant upside ‘catch-up’ move is long overdue.”

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