A level of support has formed in the chart of Polaris Industries Inc. (NYSE:PII). The has tested the level several times over the past six months and appears to be falling back down to it again. If it falls through, a breakdown is expected. Read more to learn how to profit from this trade.Polaris Industries Inc. (PII) designs and manufactures off-road vehicles, including all-terrain vehicles and side-by-side vehicles for recreational and utility purposes, snowmobiles, small vehicles, and on-road vehicles, including motorcycles and low-emission vehicles, along with the related replacement parts, garments, and accessories.
The company has been benefiting from strong demand for recreational vehicles and a shortage of inventory in the industry. This led to a strong second quarter where earnings rose 107.7% year over year and sales jumped 40.2% year over year.
PII has a solid balance sheet with only $53 million in short term debt and a current ratio of 1.2. EBITDA has grown an average of 21.4% per year over the past three years. However, earnings are expected to fall 29.1% year over year in the current quarter.