Polaris (PII) and its peers in the powersports systems space, Harley-Davidson (HOG) and Brunswick (BC), all reported Q2 headline beats and raised their 2026 outlooks amid a demanding scenario, but the quality of the upside was mixed given tariff refunds, Morgan Stanley said in a note Wednesday.
The investment firm said that Polaris delivered the "strongest share performance" while Brunswick and Harley-Davidson's "trends were mixed by geography."
Morgan Stanley said that all three stocks underperformed after releasing earnings, which the investment firm attributes to "demanding setups" as well as limited second-half flow through, specifically in Q3 where all three
companies guided or alluded to downside versus consensus.
The firm noted, however, the companies' shares have rebounded since then, particularly this week, backed by "favorable developments surrounding a potential deal with Iran and company-specific catalysts."
Morgan Stanley kept its equal-weight rating for Polaris and lifted the company's price target to $74 from $69. It also kept Brunswick's equal-weight rating and Harley-Davidson's underweight rating.
Price: $73.87, Change: $+0.11, Percent Change: +0.15%