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Polaris Inc PII

Morningstar Rating
Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Polaris Formally Appoints CEO and CFO Roles; No Change to Our Exemplary Capital Allocation Rating

Jaime M. Katz, CFA Senior Equity Analyst

Analyst Note

| Jaime M. Katz, CFA |

Wide-moat Polaris announced interim CEO Mike Speetzen would be taking the reins permanently, an appointment we view favorably given his robust knowledge base of the powersports industry. After spending five years in the CFO seat andsteering the company through two transformational acquisitions (TAP and Boat Holdings), we see Speetzen as well versed in both the company’s financial merit as well as its operational idiosyncrasies, providing a good fit for the role. Furthermore, given Speetzen’s hand in running certain facets of corporate strategy before, we do not expect any material shift in direction. Additionally, Bob Mack is set to stay on as permanent CFO, bringing his breadth of knowledge across acquisitions, operation, sales, and more to the C-suite. Given that Speetzen and Mack have worked closely in recent years, we don’t expect the stewardship of the balance sheet to change and believe Mack will attempt to maintain low leverage and ensure financial flexibility, barring any further material tie ups (which could be financed by debt).

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Company Profile

Business Description

Polaris designs and manufactures off-road vehicles, including all-terrain vehicles and side-by-side vehicles for recreational and utility purposes, snowmobiles, small vehicles, and on-road vehicles, including motorcycles and low-emission vehicles, along with the related replacement parts, garments, and accessories. The firm entered the aftermarket parts segment in 2016, tying up with Transamerican Auto Parts and then tapped into boats through the acquisition on Boat Holdings in 2018, offering exposure to new segments of the outdoor lifestyle market. Polaris products retailed through 2,300 dealers in North America and through 1,400 international dealers as well as more than 30 subsidiaries and 90 distributors in more than 120 countries outside North America at the end of 2020.

Contact
2100 Highway 55
Medina, MN, 55340
T +1 763 542-0500
Sector Consumer Cyclical
Industry Recreational Vehicles
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 15,000

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