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Is Polaris Inc (PII) a Great Value Stock Right Now?

Zacks Equity Research
·2 min read

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Polaris Inc (PII). PII is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. PII has a P/S ratio of 0.96. This compares to its industry's average P/S of 0.98.

Finally, investors will want to recognize that PII has a P/CF ratio of 11.13. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 21.99. Over the past year, PII's P/CF has been as high as 12.36 and as low as 4.69, with a median of 10.54.

Value investors will likely look at more than just these metrics, but the above data helps show that Polaris Inc is likely undervalued currently. And when considering the strength of its earnings outlook, PII sticks out at as one of the market's strongest value stocks.


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Zacks Investment Research