Analyzing Yamaha (OTCMKTS:YAMCY) & Polaris (NYSE:PII)

Yamaha (OTCMKTS:YAMCY) and Polaris (NYSE:PII) are both mid-cap consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Profitability

This table compares Yamaha and Polaris’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Yamaha	N/A	N/A	N/A
Polaris	-3.50%	16.77%	2.91%

Analyst Recommendations

This is a breakdown of current recommendations for Yamaha and Polaris, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Yamaha	0	1	0	0	2.00
Polaris	1	11	1	1	2.14

Polaris has a consensus target price of $67.00, suggesting a potential downside of 1.01%. Given Polaris’ stronger consensus rating and higher probable upside, analysts clearly believe Polaris is more favorable than Yamaha.

Dividends

Yamaha pays an annual dividend of $0.10 per share and has a dividend yield of 1.2%. Polaris pays an annual dividend of $2.72 per share and has a dividend yield of 4.0%. Polaris pays out -58.7% of its earnings in the form of a dividend. 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.

Valuation & Earnings

This table compares Yamaha and Polaris”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Yamaha	N/A	N/A	N/A	N/A	N/A
Polaris	$7.45 billion	0.52	-$465.50 million	($4.63)	-14.62

Yamaha has higher earnings, but lower revenue than Polaris.

Institutional and Insider Ownership

88.1% of Polaris shares are held by institutional investors. 2.4% of Polaris shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Polaris beats Yamaha on 12 of the 13 factors compared between the two stocks.

About Yamaha

Yamaha Corporation, together with its subsidiaries, engages in the musical instruments, audio equipment, and other businesses in Japan and internationally. It manufactures and sells pianos; guitars; keyboards; strings; basses and amps; brass and woodwinds; marching instruments; drums; percussion instruments; music production tools; audio and visual products; and professional audio equipment under the Bösendorfer, Steinberg, Line 6, Ampeg, and Nexo brands. The company also provides acoustic design, unified communication devices, electronic devices, automotive sound system, automobile interior components, factory automation equipment, and golf products. In addition, it is involved in the music schools and resort business. The company was founded in 1887 and is headquartered in Hamamatsu, Japan.

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.