Which Is a Better Investment, Polaris Inc or Vista Outdoor Inc Stock? (2024)

Sifting through countless of stocks in the Recreational Products industry can be tedious, and sometimes two stocks are just too similar to judge which is the better investment. If you’re on the fence about investing in Vista Outdoor Inc or Polaris Inc because you’re not sure how they measure up, it’s important to compare them on a few factors before making your decision.

Read on to learn how Vista Outdoor Inc and Polaris Inc compare based on key financial metrics to determine which better meets your investment needs.

Vista Outdoor Inc. is a global designer, manufacturer, and marketer of outdoor recreation and shooting sports products. It operates through two segments: The Kinetic Group and Revelyst. The Kinetic Group segment designs, develops, distributes, and manufactures ammunition, primers and components and serves devoted hunters, recreational shooters, federal and local law enforcement agencies and the military. Kinetic Group segment consists of its Ammunition operating segment, which includes its ammunition-related businesses, including Federal, Remington, CCI, Speer, and HEVI-Shot, which are collectively referred to as The Kinetic Group business. The Revelyst segment designs, develops, distributes, and manufactures gear and equipment to a diverse range of outdoor enthusiasts around the world, including hikers, campers, cyclists, off-road riders, skiers, snowboarders, backyard grillers, golfers, anglers, and hunters. Its portfolio brands include Foresight Sports, Bushnell Golf, and others.

Polaris Inc. is engaged in designing, engineering, manufacturing and marketing of powersports vehicles. The Company also designs and manufactures or sources parts, garments and accessories (PG&A), which includes aftermarket accessories and apparel. The Company operates through three segments: Off Road, On Road and Marine. The Off Road segment consists of off-road vehicles and snowmobiles. The On Road segment designs and manufactures motorcycles, moto-roadsters, light duty hauling, and passenger vehicles. The Marine segment designs and manufactures boats that are designed to compete in key segments of the recreational marine industry, specifically pontoon and deck boats. Its product line-up includes the RANGER, RZR and Polaris XPEDITION and GENERAL side-by-side off-road vehicles; Sportsman all-terrain off-road vehicles; military and commercial off-road vehicles; snowmobiles; Indian Motorcycle mid-size and heavyweight motorcycles; Slingshot moto-roadsters, and pontoon and deck boats.

As of April 24, 2024, Vista Outdoor Inc had a $2.0 billion market capitalization, compared to the Recreational Products median of $386.7 million. Vista Outdoor Inc’s stock is NA in 2024, NA in the previous five trading days and up 32.49% in the past year.

Currently, Vista Outdoor Inc does not have a price-earnings ratio. Vista Outdoor Inc’s trailing 12-month revenue is $2.8 billion with a -12.2% net profit margin. Year-over-year quarterly sales growth most recently was -9.6%. Analysts expect adjusted earnings to reach $3.853 per share for the current fiscal year. Vista Outdoor Inc does not currently pay a dividend.

Currently, Polaris Inc’s price-earnings ratio is 12.5. Polaris Inc’s trailing 12-month revenue is $8.5 billion with a 4.6% net profit margin. Year-over-year quarterly sales growth most recently was -20.3%. Analysts expect adjusted earnings to reach $7.882 per share for the current fiscal year. Polaris Inc currently has a 3.1% dividend yield.

Stock evaluation requires access to huge amounts of data and the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movements. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors streamline and work through such data.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A‐F grades for each of five key investing factors: value, growth, momentum, earnings estimate revisions and quality. Here, we’ll take a closer look at Vista Outdoor Inc and Polaris Inc’s stock grades to see how they measure up against one another.

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Successful stock investing involves buying low and selling high, so stock valuation is an important consideration for stock selection.

Buying stocks that are going to go up typically means buying stocks that are undervalued in the first place, although momentum investors may argue that point.

AAII’s A+ Investor Value Grade derives from a stock’s value score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are a good value and so on.

Vista Outdoor Inc has a Value Score of 71, which is Value. Polaris Inc has a Value Score of 57, which is Average.

As you can clearly see from the Value Grade breakdown above, Vista Outdoor Inc is considered to have better value than Polaris Inc. For investors who focus solely on a company’s valuation, Vista Outdoor Inc could be a good stock to add to their portfolio. However, it’s important for investors to analyze multiple factors based on a wide range of metrics before deciding whether to buy.

The foundation of growth investing is seeking out stocks of companies exhibiting strong, consistent and prolonged growth that is expected to continue into the future.

In order to compute the growth score and assign it a letter grade, the percentile ranks for each of three components‐consistency of annual sales growth, five-year sales growth rankings adjusted for extreme levels, and consistency of positive annual cash from operations‐must be determined. These three rank figures are added together, and the sum is ranked against the entire stock universe to arrive at a company’s Growth Score to create an equal distribution of grades.

The companies in the bottom 20% of the stock universe receive Growth Grades of F, considered to be very weak, while those in the top 20% receive A grades, which are considered very strong.

Vista Outdoor Inc has a Growth Score of 79, which is Strong. Polaris Inc has a Growth Score of 90, which is Very Strong.

Momentum grades help to uncover stocks experiencing anomalously high rates of return; research finds that stocks with high relative levels of momentum tend to outperform, whereas those with low levels of momentum tend to continue underperforming. Momentum is based on the price change of a stock over a specified period relative to all other stocks.

Typically, AAII looks at the weighted relative strength over the trailing four quarters. The weighted four-quarter relative strength rank is the relative price change for each of the past four quarters. The most recent quarterly price change is given a weight of 40% and each of the three previous quarters are given a weighting of 20%.

Vista Outdoor Inc has a Momentum Score of 81, which is Very Strong. Polaris Inc has a Momentum Score of 33, which is Weak.

Earnings estimate revisions scores take into account the magnitude of a company’s earnings surprise in its last two reported fiscal quarters. Often, surprises beget further surprises‐or at least continued sales growth (the exact opposite is generally true, too).

AAII’s A+ Investor Quality Grade comes from the ranking of key metrics. Specifically, the quality grade is the percentile rank of the composite of return on assets (ROA), return on invested capital (ROIC), gross profit relative to assets, buyback yield, change in total liabilities to assets, accruals, Z double prime bankruptcy risk (Z) score and F-Score.

These 2 key factors, when combined with the above, provide a holistic view into a particular stock. Further, by joining A+ Investor you can see whether Vista Outdoor Inc and Polaris Inc pass any of our 60+ stock screens that have outperformed the market since their creation.

Overall, Vista Outdoor Inc stock has a Value Score of 71, Growth Score of 79 and Momentum Score of 81.

Polaris Inc stock has a Value Score of 57, Growth Score of 90 and Momentum Score of 33.

Comparing Vista Outdoor Inc and Polaris Inc’s grades, scores and metrics can act as a solid basis to determine whether they may be a good investment or not. You’ll also want to look at your portfolio’s asset allocation as well as your risk tolerance and financial goals to see if either of these stocks would make a good fit for you. AAII can help you figure out which investments align with your individual needs and preferences.

Investors are encouraged to do their own due diligence and research. In this way, individuals can effectively become managers of their own assets‐without having to rely on others for financial independence. You can count on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis.

A+ Investor adds to our qualitative teaching with a powerful data suite to help you whittle down investment choices to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.