Polaris (NYSE:PII – Get Free Report) and Sturm, Ruger & Company, Inc. (NYSE:RGR – Get Free Report) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.
Risk & Volatility
Polaris has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500. Comparatively, Sturm, Ruger & Company, Inc. has a beta of 0.15, meaning that its stock price is 85% less volatile than the S&P 500.
Valuation & Earnings
This table compares Polaris and Sturm, Ruger & Company, Inc.”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Polaris | $7.15 billion | 0.41 | -$465.50 million | ($4.63) | -11.27 |
| Sturm, Ruger & Company, Inc. | $546.06 million | 1.27 | -$4.39 million | $0.75 | 57.82 |
Sturm, Ruger & Company, Inc. has lower revenue, but higher earnings than Polaris. Polaris is trading at a lower price-to-earnings ratio than Sturm, Ruger & Company, Inc., indicating that it is currently the more affordable of the two stocks.
Dividends
Polaris pays an annual dividend of $2.72 per share and has a dividend yield of 5.2%. Sturm, Ruger & Company, Inc. pays an annual dividend of $0.84 per share and has a dividend yield of 1.9%. Polaris pays out -58.7% of its earnings in the form of a dividend. Sturm, Ruger & Company, Inc. pays out 112.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Polaris has raised its dividend for 30 consecutive years. Polaris is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional and Insider Ownership
88.1% of Polaris shares are owned by institutional investors. Comparatively, 64.0% of Sturm, Ruger & Company, Inc. shares are owned by institutional investors. 2.4% of Polaris shares are owned by insiders. Comparatively, 4.6% of Sturm, Ruger & Company, Inc. shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Analyst Recommendations
This is a summary of current recommendations for Polaris and Sturm, Ruger & Company, Inc., as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Polaris | 1 | 12 | 1 | 0 | 2.00 |
| Sturm, Ruger & Company, Inc. | 0 | 2 | 1 | 0 | 2.33 |
Polaris presently has a consensus price target of $65.89, suggesting a potential upside of 26.32%. Sturm, Ruger & Company, Inc. has a consensus price target of $46.00, suggesting a potential upside of 6.07%. Given Polaris’ higher possible upside, analysts clearly believe Polaris is more favorable than Sturm, Ruger & Company, Inc..
Profitability
This table compares Polaris and Sturm, Ruger & Company, Inc.’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Polaris | -3.50% | 16.77% | 2.91% |
| Sturm, Ruger & Company, Inc. | 2.11% | 6.58% | 5.35% |
About Polaris
Polaris Inc. designs, engineers, manufactures, and markets powersports vehicles in the United States, Canada, and internationally. It operates through three segments: Off-Road, On-Road, and Marine. The company offers off-road vehicles (ORVs), including all-terrain vehicles and side-by-side vehicles; military and commercial ORVs; snowmobiles; motorcycles; and moto-roadsters, quadricycles, and boats. It also provides ORV accessories comprising winches, bumper/brushguards, plows, racks, wheels and tires, pull-behinds, cab systems, lighting and audio systems, cargo box accessories, tracks, and oil; snowmobile accessories, which include covers, traction products, reverse kits, electric starters, tracks, bags, windshields, oil, and lubricants; and motorcycle accessories, such as saddle bags, handlebars, backrests, exhausts, windshields, seats, oil, and various chrome accessories. In addition, the company offers light duty hauling and passenger vehicles; gear and apparel, such as helmets, goggles, jackets, gloves, boots, bibs, hats, pants, and leathers; and pontoon and deck boats. The company provides its products through dealers and distributors, and online; and retail and e-commerce marketplaces. The company was formerly known as Polaris Industries Inc. Polaris Inc. was founded in 1945 and is headquartered in Medina, Minnesota.
About Sturm, Ruger & Company, Inc.
Sturm, Ruger & Co., Inc. engages in the business of designing, manufacturing, and selling firearms to domestic customers. It operates through the Firearms and Castings segments. The Firearms segment focuses on manufacturing and selling rifles, pistols, and revolvers principally to a number of federally licensed, independent wholesale distributors. The Castings segment offers steel investment castings and metal injection molding parts. The company was founded by William B. Ruger in 1949 and is headquartered in Southport, CT.
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