Archive for the ‘Arctic Cat’ Category

Polaris Outperforms May Stock Slump

May 31, 2010

Dow and S&P 500 Decline Sharply

Polaris Industries common stock lost ground in May, but its decline was only about one-third of the ground lost by leading market indicators, and it was much better than two other powersports stocks, Harley-Davidson and Arctic Cat.

Polaris closed May 28, 2010, at $58.70, off $2.35, or 3.8%, from its close on May 3 of $61.05. Polaris stock was given a strong boost on May 24 when analyst Joe Hovorka of Raymond James upgraded his Polaris rating from Market Perform (third level rating) to Strong Buy (top rating).

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Investors In Powersports Stocks Enjoyed 2009

December 31, 2009

Harley, Polaris, Arctic Cat Post Hefty Gains

Investors who placed bets on the powersports industry last year at this time— and held steady for the ride through the year— have reason to celebrate tonight. I checked the performance of three of the leading powersports stocks this year—Harley-Davidson (HOG), Polaris Industries (PII), and Arctic Cat (ACAT) and each of them outperformed the Dow Jones Industrial Average (DJIA) by a wide margin in two cases and matching it in the last one.

It wasn’t a smooth ride, however, and it took a firm hand to stay in the game through the sharp downtown in the first quarter.  For example, while the Dow lost 13% in value during the first two months of 2008, Polaris lost 25%, Harley  dropped 21%, and Arctic Cat slipped 20%.

For the year, though, the Dow climbed 1,772 points from 8,776 on Dec. 31, 2008, to 10,548 at the close yesterday. That’s a 20% jump. During the last 52 weeks, the Dow ranged from a low of 6,440 to a high of 10,605.

Polaris, the Minneapolis-based manufacturer of ATVs, UTVs, motorcycles, snowmobiles and electric vehicles, posted the biggest dollar gain during the last year of the three companies I looked at. Polaris common moved from $28.65 on Dec. 31, 2008, to $43 at the close yesterday. That’s a gain of $14.35, or 50.1% over the year. Its 52-week performance ranged from $14.53 to a high of $49.74.

If you would have purchased 1,000 shares of Polaris common stock one year ago, your investment would have gained $28,650, not considering quarterly dividends nor any sales commissions. Now, wouldn’t that provide a nice party tonight.

Securities analysts who follow the Polaris stock like the management team lead by new CEO Scott Wine, and Bennett Morgan, president and COO, and a long-time Polaris executive. When talking about Polaris, investors also talk about its ability to quickly bring new products to market, its efficient operations that emphasize cost controls, and its growing ability to control inventories at the dealer level through its Max Velocity Program (MVP) which allows dealers increased ordering flexibility.

Harley-Davidson gained $8.53, or 50.3%, climbing from $16.97 at the close on Dec. 31, 2008, to $25.50 at yesterday’s close. Harley investors had perhaps the toughest time waiting calmly for gains on the HOG stock as the company reworked its operations in several major steps.

One move with immediate and long-term implications was  the new contract it won with workers at its York, PA, plant that  permits the company to cut loose nearly half the 2,000 employee York work force and move ahead with major physical improvements in the plant. The plant modernization will be aided by a stimulus package from the state of Pennsylvania. Harley said at one point that it was considering relocating the operation to Kentucky.

In its second big reorganizational move, Harley dumped its MVAgusta operation and it closed its Buell sport bike business.

During the 2009 52-week period, Harley stock ranged from a low of $7.99 to a high of $30.00

Arctic Cat common stock is played at a much lower level than either Polaris or Harley, but it, too, posted a nice gain of 20% during the period Dec. 31,  2008, to Dec. 30, 2009. It climbed $4.16 for the year, moving from $4.79 in December 2008 to $8.95 yesterday.

Cat had a tough year, partly because of its dependence on snowmobiles and partly because of the loss of Gander Mountain, its high visibility outdoors retail chain based in Minneapolis. Gander had been carrying Arctic’s ATV and SXS lineup in its major stores. Arctic stock ranged from a low of $2.40 to a high of $9.27 during the last 52 weeks.

Okay, so now you’re probably waiting for my forecast on the performance of these stocks in 2010. Sorry, I don’t have one. After reporting on publicly traded stock for more than 40 years, I’ve come up with one basic rule: Stock market performance doesn’t always reflect corporate performance, especially when you try to tie it to a specific quarter or other reporting period. I don’t have a clue how these three stocks, or the Dow, for that matter, might perform over the next four quarters. And if I did know,  I wouldn’t give that information away; I would charge a lot of money for it. Isn’t that what investment advisors do?

Happy New Year and good luck with your investment decisions. I hope your powersports stocks perform well for you in 2010 as these three stocks did in 2009. JD

Contact me with news tips and story ideas at
976/893-6876 or joe@powersportsupdate.com

Ecowatercraft Hopes to Offer Electric PWC

June 4, 2009

EcoWatercraft is a company planning to be the first all electric personal watercraft manufacturer to go into production.
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The company is the brainchild of founder Barrett Taylor. Taylor says, as a collegiate triathlete, he often swam amongst extremely heavy fumes expelled from the personal watercraft patrolling the swim site – something that coaxed him to look more closely at the health implications of breathing in toxic fumes and served as inspiration to assemble a team dedicated to bringing an electric personal watercraft to market.

Why electric? According to Taylor, the ECO emits no emissions, operates in complete silence, expands PWC use by being permitted on many lakes that restrict gasoline vehicles, benefits from acceleration inherent in electric vehicles, and offers convenience by requiring no fuels, oil or maintenance.

Sounds good, right? Many “green” blogs and websites appear to think so. However, there are a couple of statements that show a glaring lack of industry knowledge.

First, EcoWatercraft claims it “will be the first American personal watercraft corporation.” In fact, Minnesota-based powersports manufacturers Arctic Cat and Polaris were in the market years ago.

Second, Ecowatercraft says it “will provide the most customer oriented experience in the personal watercraft industry.” Dubious, since they’ll first have to gain the financial strength equal to or greater than companies like Kawasaki, Yamaha, BRP and Honda. Plus, they’ll likely be selling through the same dealers as those other OEMs.

Finally, Ecowatercraft, throughout its marketing literature, uses Kawasaki’s trademarked “JetSki” name in lieu of the general term of “personal watercraft.” A rookie mistake, for sure.

Inventor Patents Passenger ‘Safety Grips’

March 9, 2009

An inventor from Portland, Ore., has patented an accessory that he says would help passengers of motorcycles, ATVs and personal watercraft hold on to the operator.

Inventor service company InventHelp publicized the product, but failed to name its inventor client. outmax800refixt1

The “Safety Grips” (not to be confused with the previously released “Buddy Belt”) consist of a nylon, padded belt that is secured via hook-and-loop fasteners. Sewn into the rear of the belt would be a pair of upright handles facing the passenger. In use, the operator would adjust the belt to fit his or her waist, and the passenger grips the handles throughout the duration of the ride.

According to InventHelp, the inventor was inspired to create the Safety Grips after an off-roading trip. “We used this belt while riding quads on sand dunes at the beach, and we got a lot of positive feedback from both passengers and operators,” he said.

Lets hope the inventor was riding the ATV in the prescribed manner – in other words, not riding two-up on a single rider vehicle. Existing two-up ATVs, from BRP and Arctic Cat, come supplied with multi-position passenger grab rails and backrest.

Taiwan Firms Aim for U.S.

February 15, 2009

I was asked to speak at the Taiwan Powersports Symposium during the Dealer Expo in Indianapolis.

The event included journalists and manufacturers focused on giving an insight about Taiwan’s powersports industry and how it may impact business here in the U.S. The comments below are my own, offered during the presentation.

“While it’s unlikely any of us were in the motorcycle industry during the early 1960s, I think it’s pretty well known how the first of the Japan-made two-wheelers to enter the U.S. back then were greeted by consumers and retailers who had, up to that point, only known U.S. and European brands.

Although the things said about those early Japanese bikes weren’t too flattering, the Big Four from Japan nevertheless grew to become the major players in the U.S. motorcycle market.

Well, nowadays, I hear some people speak dubiously about machines coming from other areas of the Far East. The thing is, I find most of the (more…)

Hot Off The Press At Dealernews.com

January 30, 2009

Honda’s worldwide sales of motorcycles and ATVs for the nine-month period ended Dec. 31, 2008, totaled 8.11 million units, up 16.7 percent from 6.95 million units during the same nine-month period in 2007. In North America – including the U.S., Canada and Mexico – the company wholesaled 248,000 units, down from 303,000 units. Motorcycles accounted for 143,000 units, down from 157,000 units; ATVs accounted for 105,000 units, down from 146,000 units.

Polaris CEO Scott Wine says 2009 will be a challenging year, and the OEM expects sales to decline 15 to 23 percent compared to 2008. “Retail sales trends for each of the industries and geographic markets in which Polaris competes are expected to remain soft for much, if not all, of 2009,” Wine says. “As a result, we will be more conservative with our production and shipment expectations for 2009.”

Arctic Cat says the OEM is focused on multiple efforts to rescale its business in the current economic climate. Actions include streamlining production operations from three production lines to two; a planned company-wide shutdown; the elimination of approximately 100 positions, or 7 percent of its 1,400 employees; the elimination of the dealer incentive trip; suspending regular quarterly cash dividends; a salary reduction of 5 percent for all officers; selective compensation and benefit adjustments; reduced vacation accrual; a hiring freeze; and lowering operating expenses by 10 to 15 percent through greater efficiencies in lean manufacturing and global low-cost sourcing.

KTM believes the economic environment for the automotive and motorcycle industry in particular could continue to worsen in the United States and Europe, and the company is responding to the scenario by scaling back production by up to 20 percent from last year and continuing to implement ongoing improvements and cost-cutting measures.

Japan’s four major motorcycle manufacturers produced 1.22 million units in 2008, down 26.8 percent from 1.68 million units produced in 2007. Honda, Kawasaki, Suzuki and Yamaha together shipped 372,362 units to the United States in 2008, down 18.2 percent from 455,139 units shipped in 2007.

Visit Dealernews.com to read more about these and other powersports-related topics.