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Should Value Investors Buy Polaris Inc (PII) Stock?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 stock to keep an eye on 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 should also note that PII holds a PEG ratio of 1.62. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. PII's industry currently sports an average PEG of 4.43. Within the past year, PII's PEG has been as high as 1.62 and as low as 0.49, with a median of 1.14.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. PII has a P/S ratio of 0.89. This compares to its industry's average P/S of 1.16.

Finally, our model also underscores that PII has a P/CF ratio of 9.16. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. PII's P/CF compares to its industry's average P/CF of 21.99. Over the past 52 weeks, PII's P/CF has been as high as 12.36 and as low as 4.69, with a median of 10.15.

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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