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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Polaris Inc. (XNYS:PII) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
PII
Name:
Polaris Inc. (XNYS:PII)
Sector:
- 106500.00K
Industry:
Recreational Vehicles
CEO:
Mr. Scott Wine
Total Employees:
16,000
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -111.93% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF POLARIS INC.(PII) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND RECREATIONAL VEHICLES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
112.33
One Month Price Target:
$113.31
Six Month Price Target :
$118.18
Likely Price in One Year's Time:
Ticker:
$124.04
Likely Trading Range Today Under (Normal Volatility)
$111.81
Price Upper limit ($) :
$113.
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$105.2
This week:
$96.38
This month :
$80.42
Other Primary facts
Market Cap:
6.46B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
59.56M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
13.67%
-19.54%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$145.43
$130.21
$79.23
$94.45
Medium risk (<10%) entry points
Buy Call
Sell Call
$125.26
Buy Put:
Sell Put:
$122.01
$99.36
$102.65
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
PII
Sharpe Ratio:
1.89%
Comparison:
PII, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -20.99% lower than the industry
& is -16.96% lower than the market/S&P 500 average
Average Returns/Yield of
PII
Daily returns:
0.07%
Weekly returns:
0.34%
Monthly returns:
1.36%
Yearly returns:
23.23%
Comparison of returns:
Average annual returns/yield (last 3 years) is -29.73% below industry average
Classification:
PII, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.22
Statistical test of Returns:
PII has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.13%
Weekly Volatility:
6.99%
Monthly Volatility:
13.98%
Yearly Volatility:
48.42%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.93%
Volatility in last five trading days has been -70.20% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.35%
Weekly VaR:
-14.20%
Monthly VaR:
-28.40%
How Much Can the price of
PII
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-24%
Worst case (decline):
>85%
This translates to price declining to:
$84.99
This translates to price declining to:
$16.85
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
PII is a 100.47% riskier investment compared to the market/S&P 500 & is 71.75% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -14.59% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
PII
Beta in relation to market/S&P 500--1.55
Expected beta in 1 year's time:
0.927
Expected beta in 3 year's time:
1.311
Unlevered (debt free) Beta:
0.737
Beta in relation to Nasdaq (XNAS):
1.071
Beta in relation to all global stocks::
0.997
Beta Comparison & Analysis
Beta of competitors/peers::
1.963
Beta is -20.99% lower than peers
Average Industry Beta:
1.654
Beta is -6.21% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
26.07%
Sustainable growth rate is -13.44% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.025
Alpha is -70.88% below industry average alpha yield
Alpha is 162% higher than market/& is unsustainably high
Analysis of Cost of Capital of
PII
Equity cost of capital:
0.138
Equity cost of capital is -4.86% below industry mean WACC
Unlevered (without debt) cost of capital:
6.55%
Before-tax cost of debt:
2.08%
After-tax cost of debt:
1.65%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.65%
WACC is -10.80% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$137.75
Revenue growth rate per share of (3Y):
5.97
Annual revenue growth rate is -36.12% below industry average
EPS:
$6.90
Expected Annual growth rate of EPS (3Y):
14.35%
Expected future EPS growth rate is -61.42% lower than the Recreational Vehicles industry
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: 4.97%
Equity growth rate per share is -94.35% lower than the industry
Debt per share
$25.86
EBITDA per share
$13.76
Valuation Analysis Today of
PII
P/E Ratio:
16.44
P/E Ratio of Competitors/Peers:
29.98
P/E ratio is -45.16% lower than main peers & is 36.73% higher than the industry
Stock price/value with industry average P/E ratio: $82.98
PII is 35.37% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $30.34
Present value of the expected future dividends only: $19.13
P/S (Price to Sales ratio):
0.82
Price to sales ratio is -31.82% below the industry mean
P/B (Price to book value ratio):
5.97
-
-
Net income growth rate (3Y):
50.23%
Net income growth rate is -93.92% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 8.82%
Dividend yeild: 2.26%
Previous Dividend: $0.64
Previous adjusted dividend: $0.64
Previous Dividend: $2.54
Expected next dividend best case: $0.65
Expected next dividend worst case: $0.63
Average dividend payment (long-term): $0.63
Average dividend increase/decrease (growth rate) % per period: 0.44%
Expected next dividend payment date: 13/09/2022
Expected next dividend record date: 30/08/2022
-
Previous dividend payment date: 15/06/2022
Previous dividend record date: 06/01/2022
-
Dividend History:
2022-05-31--$0.64
2021-11-30--$0.63
2021-05-31--$0.63
2022-02-28--$0.64
2021-08-31--$0.63
2021-05-28--$0.63
Dividend growth rate is -102.44% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
137.69%
Net debt to equity ratio:
157.48%
Debt to assets ratio:
30.03%
Net debt to assets ratio:
34.35%
Debt-to-asset ratio is -52.01% below industry average
Ability to repay debt:
Interest coverage ratio:
18.42
Interest coverage ratio is -26.04% less than industry average
Looking forward:
Debt growth rate:
24.77%
Annual debt growth is 11% higher than industry average debt growth rate
Debt repayment rate in last quarter: 21.43%
Analysis of Key Statistics
Correlation of price movement with the market:
0.693
Statistical significance of correlation:
PII has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.579
Stock price is 19.66% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.579
Correlation of price movement with Nasdaq (^IXIC):
0.011
Covariance of price movement with the market:
0.019
Kurtosis
6.106
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.621
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
PII
Gross Profit Margin Ratio:
91%
Operating Profit Margin Ratio:
7.55%
Operating profit margin is -12.62% lower than the industry
Net Profit Margin Ratio:
91%
Effective Tax Rate:
19.87%
Effective tax rate is -3.84% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
38.41%
Return on equity (ROE) is 9.39% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
8.38%
Return on assets (ROA) is -25.39% lower than the industry
Financial Leverage:
1.4x
Current Ratio:
1.18
Current ratio is -44.99% below industry average
Cash Conversion Cycle (days):
-12.2
Cash conversion cycle is -145.38% below industry average
The remaining useful life of property plant & equipment is: 5.4 years
Stock based compensation to net income ratio:
3.10%
In-depth Efficiency Analysis
Revenue generated per employee:
512.7K
Each employee generates 2% more revenue than industry average revenue per employee
EBITDA generated per employee:
51.2K
Each employee generates -30% less EBITDA than industry average revenue per employee
Profit generated per employee:
26.9K
Each employee generates -42% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 6.7K
Each employee generates 57% more free cash flow than industry average revenue per employee
Assets/Capital per employee
154.6K
Each employee generates 57% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 13.90%
Growth rate in R&D investment/expenditure is -84.18% lower than the industry
Competitors/Peer firms of
PII
BOYD GAMING CORPORATION (XNYS:BYD)
THE GAP, INC. (XNYS:GPS)
SKECHERS U.S.A., INC. (XNYS:SKX)
MARRIOTT VACATIONS WORLDWIDE CORPORATION (XNYS:VAC)
ARENA MINERALS INC. (XTSX:AN)
HILTON GRAND VACATIONS INC. (XNYS:HGV)
YETI HOLDINGS, INC. (XNYS:YETI)
PVH CORP. (XNYS:PVH)
PLANET FITNESS, INC. (XNYS:PLNT)
Current Analyst Ratings
Strong buy�4%
Buy�8%
Hold�63%
Sell�8%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
8.20B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
6.35B
1.86B
340.00M
365.80M
947.90M
582.10M
- 49000.00K
1.24B
-
44.50M
238.80M
819.60M
619.60M
429.70M
536.60M
106.60M
429.70M
Statement of Cash Flow
Date:
Period:
61.30M
Differed Income Tax :
9.40M
Stock Based Compensation :
13.30M
Change in Working Capital :
- 200700.00K
Accounts Receivables:
- 10400.00K
Other Working Capital:
- 500.00K
Other Non-Cash Items:
- 2300.00K
Net Cash Provided by Operating Activities:
- 49100.00K
Investments in PP&E:
- 57400.00K
Net Acquisitions:
18.20M
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
375.40M
-
375.40M
253.30M
1.88B
146.70M
2.66B
1.17B
390.30M
639.10M
33.30M
154.50M
91.40M
2.47B
-
5.13B
978.50M
596.80M
14.40M
-
675.60M
2.25B
1.54B
211.80M
1.76B
-
4.01B
600.00K
45.00M
- 69800.0K
1.14B
March 31, 2022 at 6:00:00 AM
7.58B
1.12B
5.13B
-
2.14B
1.8B
-
-
- 39200.00K
- 420200.00K
-
- 172300.00K
- 37900.00K
581.90M
- 48500.00K
- 300.00K
- 137100.00K
392.00M
529.10M
- 49100.00K
- 57400.00K
- 106500.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
PII
2023
2024
2025
2026
2027
$124.66
$186.73
$206.20
$227.69
$251.42