Risk/Reward Rating: Positive
Polaris finds itself in the enviable position of selling the majority of its products prior to having the actual inventory to meet the demand. For those unfamiliar with the company, Polaris is a leader in the powersports market operating in six segments: Off Road Vehicles (ORV), Snowmobiles, Motorcycles, Global Adjacent Markets, Aftermarket, and Boats. The company is best known for its all-terrain, off-road vehicles as depicted in the main image. Many are familiar with the iconic Indian motorcycle brand.
This enviable position was created by the disruptions to global supply chains caused by COVID, which limited supply. The unexpected speed of the demand snap back was supported by direct government stimulus payments and central bank liquidity injections, which encouraged plentiful and cheap financing for consumers and businesses. While reduced inventory at their independent dealers creates some risk to demand, the entire industry and many others are in the same position, and it appears consumers have adjusted.
Continue reading this report with a stoxdox membership.