Well, not equipment itself, of course. A company which makes it.
Not so long ago Jim Cramer offered the way to profit from what he calls "tale of two cities economy", i.e. economy in which rich people spend and not so rich people don't. The best way, he said, was to buy companies making recreational equipment. His two top picks were Polaris (PII) and Harley Davidson (HOG).
I have been thinking about it for some time. During this time, thanks to ongoing bull market (see my previous posts), prices went up. I hate to buy on top, I prefer to wait for dips. But again, we play cards we have, not cards we wish. I decided in favor of Polaris. It's diversified company, producing snowmobiles, motorcycles, jet skies and ATVs. It's also local company, based in Medina, Minnesota. I know this place, drive through it once in a while. Earnings are good, balance sheet is excellent. Surprisingly for a manufacturing company, Polaris has more cash than debt. Dividend had been raised lately.
Today I opened position in PII. Will add to position as price allows.
Disclosure: I am long PII.
Additional disclosure: I have no position in HOG. Positions can change any time.
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