Jim Cramer, a CNBC television personality, suggested Wednesday that the Polaris stock is a good buy. Polaris (NYSE:PII), is an American manufacturer of motorcycles, snowmobiles, ATV, boats and neighborhood electric vehicles. According to the “Mad Money” TV host, the stock is useful for investors interested in a laid back industry that has done a complete 360.
“If you believe, as I do, that America is reopening rapidly but we’re not exactly going back to normal — too much social distancing — then Polaris is indeed the kind of stock you should own,” he said. “This is a company that benefits enormously from the V-shaped recovery thesis, and it also works with a slower recovery because the great outdoors is taking market share from every other form of recreation that involves crowded indoor spaces.”
Due to the global pandemic, Cramer says camping and recreational vehicle companies are “back in a big way,” and he expressed his frustration on not seeing the possibilities in outdoor recreational businesses beforehand.
Polaris’ stock closed at USD96.19 on Wednesday and is still a great buy according to Cramer. The outdoor company has managed to salvage all losses caused by the economic downturn in February, prompted by coronavirus. The stock had previously plunged 60% and is currently up over 160% compared to April numbers.
“Polaris is taking share, they’re bringing in lots of new customers, and I think this is a once-in-a-generation opportunity for this company,” Cramer said.
The former hedge fund manager highlighted that Polaris stock is selling for 17 times the amount of next year’s earnings and that the 2.5% dividend yield was a great selling point.
“Put it all together, you got an incredibly bullish business update, a confirmation that the dividend is staying put and a lot more financial flexibility,” he said.