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Are Investors Undervaluing Polaris Inc (PII) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Polaris Inc (PII - Free Report) . PII is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Investors will also notice that PII has a PEG ratio of 1.62. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PII's PEG compares to its industry's average PEG of 4.70. PII's PEG has been as high as 1.62 and as low as 0.49, with a median of 1.15, all within the past year.

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 0.87. This compares to its industry's average P/S of 1.04.

Finally, we should also recognize that PII has a P/CF ratio of 8.54. 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. PII's current P/CF looks attractive when compared to its industry's average P/CF of 21.99. PII's P/CF has been as high as 12.36 and as low as 4.69, with a median of 10.33, all within the past year.

These are only a few of the key metrics included in Polaris Inc's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, PII looks like an impressive value stock at the moment.


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