Polaris (PII)
NYSE:PII
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Polaris
(NYSE:PII)
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Rating:51Neutral
Price Target:
$57.00
▲(5.30% Upside)
Action:DowngradedDate:01/28/26
The score is held back primarily by sharply weaker profitability in 2025 (net loss and margin compression), partially offset by strong recent cash generation and debt paydown. Technicals are soft with the stock below short-term averages, while valuation is supported by the ~4% dividend but tempered by loss-driven negative P/E. Management’s 2026 improvement outlook helps, but near-term tariffs and pricing pressure remain key risks.
Positive Factors
Strong operating cash generation
Sustained large operating cash flow provides durable financial flexibility: it supports capital investment, dividend continuity, and working-capital needs while enabling debt reduction. Strong OCF underpins resilience versus cyclical demand and funds structural initiatives despite episodic FCF volatility.
Negative Factors
Profitability deterioration
A swing to a net loss and negative EBITDA undermines core earnings power and reduces internal funding for growth or payouts. Persistently compressed margins weaken return on capital, constrain reinvestment, and raise the bar for management to sustainably restore historical profitability levels.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong operating cash generation
Sustained large operating cash flow provides durable financial flexibility: it supports capital investment, dividend continuity, and working-capital needs while enabling debt reduction. Strong OCF underpins resilience versus cyclical demand and funds structural initiatives despite episodic FCF volatility.
Read all positive factors
Polaris (PII) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.07B
Dividend Yield3.99%
Average Volume (3M)915.47K
Price to Earnings (P/E)―
Beta (1Y)1.06
Revenue Growth-9.39%
EPS Growth-173.86%
CountryUS
Employees15,000
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Recreational Vehicles
Share Statistics
EPS (TTM)0.08
Shares Outstanding56,690,670
10 Day Avg. Volume995,488
30 Day Avg. Volume915,469
Financial Highlights & Ratios
PEG Ratio0.01
Price to Book (P/B)4.34
Price to Sales (P/S)0.50
P/FCF Ratio6.45
Enterprise Value/Market Cap1.46
Enterprise Value/Revenue0.63
Enterprise Value/Gross Profit3.37
Enterprise Value/Ebitda-39.21
Forecast
1Y Price Target
$68.25Price Target Upside26.09% Upside
Rating ConsensusHold
Number of Analyst Covering9
EPS Forecast (FY)1.62
Revenue Forecast (FY)$7.28B
Polaris Business Overview & Revenue Model
Company Description
Polaris Inc. designs, engineers, manufactures, and markets power sports vehicles worldwide. It operates through three segments: Off-Road, On-Road and Marine. The company offers off-road vehicles (ORVs), including all-terrain vehicles and side-by-s...
How the Company Makes Money
Polaris primarily makes money by selling powersports vehicles to a dealer network, which then sells to end customers. Vehicle sales are the core revenue driver and span major product categories including off-road vehicles, snowmobiles, and on-road...
Polaris Earnings Call Summary
Earnings Call Date:Jan 27, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 28, 2026
Earnings Call Sentiment Positive
The call balanced meaningful operational and product progress—share gains, strong aftermarket growth, manufacturing cost reductions, quality improvements, inventory normalization, $741M operating cash generation and substantial debt paydown—against pervasive near-term macro and policy headwinds. Tariffs, promotional pressure, segment softness in on-road and marine, a low full-year free cash flow figure, and a negative Q1 EPS outlook are material near-term challenges. Management provided constructive 2026 guidance (sales growth ex-Indian, EBITDA margin expansion and EPS targets) and detailed mitigation plans (China spend reduction, lean improvements), suggesting improving underlying business fundamentals despite the current tariff-driven drag.Positive Updates
Quarterly and Retail Growth
Q4 sales increased 9%; North American retail rose 9% (excluding youth). Off-road vehicle (ORV) sales were up 11% in the quarter and international sales grew 9%.
Negative Updates
Material Tariff Headwind
Tariffs represented the most significant challenge: ~$37 million of tariff cost hit adjusted gross margin in Q4; company expects approximately $90 million of incremental tariffs in 2026 (Q1 headwind ~ $45 million) and total ex-Indian tariffs for the year of roughly $215 million—creating a sizable drag on margins and EPS.
Read all updates
Q4-2025 Updates
Positive
Negative
Quarterly and Retail Growth
Q4 sales increased 9%; North American retail rose 9% (excluding youth). Off-road vehicle (ORV) sales were up 11% in the quarter and international sales grew 9%.
Read all positive updates
Company Guidance
Polaris guided 2026 total-company sales up 1–3% (which equals roughly 7–9% organic growth if you exclude ~ $300M of Indian Motorcycle revenue), adjusted EBITDA margin expanding 80–120 basis points, and adjusted EPS of $1.50–$1.60 (Indian separation expected to deliver ~$0.75–$0.80 of 2026 benefit and about $1.00 annualized). Management also assumed ~ $90M of incremental tariffs in 2026 (about $45M in Q1 and roughly $215M of total tariffs ex‑Indian for the year), more than $30M of absorption benefit from operations, operating expenses down ~4% from the separation, $30–$35M of TSA other income, roughly $160M of operating cash flow / $120M of free cash flow, Q1 sales growth >10% with Q1 adjusted EPS ≈ –$0.45, and ongoing structural progress (China spend ~14% of material COGS at year‑end 2025, target <5% by YE‑2027, >$60M manufacturing savings in 2025, $240M of plant cost removal over two years, and a $25M warranty reduction).Polaris Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
48
Neutral
Cash Flow
67
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 7.15B | 7.18B | 8.93B | 8.59B | 7.44B |
| Gross Profit | 1.32B | 1.40B | 1.91B | 1.91B | 1.70B |
| EBITDA | -114.00M | 569.40M | 1.01B | 1.07B | 881.20M |
| Net Income | -465.50M | 110.80M | 502.80M | 589.70M | 493.90M |
Balance Sheet | |||||
| Total Assets | 4.89B | 5.53B | 5.52B | 5.22B | 5.05B |
| Cash, Cash Equivalents and Short-Term Investments | 138.00M | 287.80M | 367.80M | 324.50M | 502.30M |
| Total Debt | 1.54B | 2.20B | 2.05B | 2.17B | 1.89B |
| Total Liabilities | 4.05B | 4.23B | 4.10B | 4.12B | 3.82B |
| Stockholders Equity | 828.40M | 1.29B | 1.42B | 1.10B | 1.22B |
Cash Flow | |||||
| Free Cash Flow | 558.10M | 6.50M | 513.20M | 202.00M | -4.60M |
| Operating Cash Flow | 741.00M | 268.20M | 925.80M | 508.60M | 293.70M |
| Investing Cash Flow | -139.50M | -270.90M | -462.00M | -324.60M | -303.90M |
| Financing Cash Flow | -693.00M | -59.20M | -431.30M | -363.20M | -107.60M |
Polaris Technical Analysis
Negative
54.13
Price Trends
61.20
Negative
63.46
Negative
58.42
Negative
Market Momentum
-1.66
Negative
42.27
Neutral
70.41
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PII, the sentiment is Negative. The current price of 54.13 is below the 20-day moving average (MA) of 54.21, below the 50-day MA of 61.20, and below the 200-day MA of 58.42, indicating a bearish trend. The MACD of -1.66 indicates Negative momentum. The RSI at 42.27 is Neutral, neither overbought nor oversold. The STOCH value of 70.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PII.
Polaris Risk Analysis
Polaris disclosed 27 risk factors in its most recent earnings report. Polaris reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Polaris Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $2.94B | 15.99 | 13.76% | 3.72% | 5.74% | 39.40% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
58 Neutral | $4.60B | -35.47 | -7.80% | 2.27% | -4.78% | -189.89% | |
53 Neutral | $889.52M | 58.59 | 3.39% | 3.42% | 1.38% | ― | |
52 Neutral | $2.18B | 7.26 | 10.26% | 3.47% | -15.99% | -6.76% | |
51 Neutral | $3.07B | -2.96 | -42.42% | 3.99% | -9.39% | -173.86% | |
51 Neutral | $4.16B | 82.80 | 7.01% | 1.94% | 1.43% | 34.76% |
* Consumer Cyclical Sector Average
PII
Polaris
54.13
14.79
37.60%
BC
Brunswick
70.95
18.84
36.16%
LCII
LCI Industries
121.35
37.66
44.99%
HOG
Harley-Davidson
19.47
-4.88
-20.05%
THO
Thor Industries
79.12
3.76
4.99%
WGO
Winnebago Industries
31.47
-1.95
-5.84%
Polaris Corporate Events
Executive/Board Changes
Polaris Announces Resignation of Long-Serving Board Director
Neutral
Jan 9, 2026
On January 8, 2026, Polaris Inc. announced that long-serving director Kevin M. Farr, who has been on the board since 2013 and currently chairs the Audit Committee and sits on the Compensation Committee, will resign from the board effective January...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.