Polaris Industries designs, engineers, manufactures, and markets off-road vehicles, snowmobiles, motorcycles, and small vehicles primarily in the United States, Canada, Western Europe, Australia, and Mexico. The company was founded in 1987 and is based in Medina, Minnesota.
PII Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Polaris Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Polaris Inc ranked in the 41th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. In terms of the factors that were most noteworthy in this DCF analysis for PII, they are:
As a business, PII is generating more cash flow than 78.46% of positive cash flow stocks in the Consumer Cyclical.
Polaris Inc's effective tax rate, as measured by taxes paid relative to net income, is at 62 -- greater than 95.54% of US stocks with positive free cash flow.
Polaris Inc's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -0.37. This coverage rate is greater than that of just 23.56% of stocks we're observing for the purpose of forecasting via discounted cash flows.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
CCK, DECK, CMCSA, NYT, and PTVE can be thought of as valuation peers to PII, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.
Citi launches coverage on Polaris (PII) with a Buy rating asittakes in the surge of demand for recreation vehicles.Analyst Shawn Collins: "With COVID-19 limiting or shutting down many seasonal activities, consumers are realizing the great outdoors is still open. Outdoor recreation enables social-distancing, is used in non-urban environments, and does not...
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