Polaris Recalls 327 Vehicles - Analyst Blog

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All-terrain vehicles maker Polaris Industries, Inc. ( PII ) has voluntarily recalled around 327 units of its 2013 Polaris Ranger 400 recreational off-highway vehicles due to potential crash hazard arising from a defect. The recall was conducted in cooperation with the U.S. Consumer Product Safety Commission (CPSC).

The CPSC, on its website, stated that the throttle in the recalled vehicles can fail to operate properly, causing the rider to lose control and crash. However, no incidents of injuries were reported.

The vehicles involved in the recall were sold by Polaris dealers nationwide from July through September 2012 for roughly $8,300. The consumers have been advised to immediately stop using the recalled vehicles and contact the company for a free repair.

Polaris Industries makes snowmobiles, off-road vehicles and on-road vehicles with annual sales of $2.7 billion. The company also offers replacement parts, accessories and recreational apparel. It markets its products through independent dealers and distributors under a host of brands, primarily in the U.S., Canada and Europe.

The company reported its third-quarter 2012 results on October 18. It posted a 40% year-over-year gain in earnings per share to $1.33, beating the Zacks Consensus Estimate of $1.20.

Revenues jumped 21% year over year to $879.9 million. The growth was driven by strong demand as well as market share gains for the company's Ranger and RZR side-by-side off-road vehicles. Manufacturing realignment and cost management initiatives also supported the results.

Polaris Industries expects higher revenues and earnings for full-year 2012, based on its strategic direction and implementation strategies. The company expects earnings per share between $4.32 and $4.37 for the year, up 35%-37% from $3.20 in 2011. Sales are expected to grow 19%-20% from 2011. The company will report its fourth quarter results on January 29.

Polaris Industries currently retains a Zacks Rank #2 (Buy). Arctic Cat Inc. ( ACAT ), which also makes recreational Vehicles, holds a Zacks Rank #4 (Sell).

ARCTIC CAT INC (ACAT): Free Stock Analysis Report

POLARIS INDUS (PII): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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