) to sell from neutral, citing expectations of lower sales.
Analyst Gary Cooper says sales of U.S. terrain vehicles, or ATVs, will decline in 2006 due to rising inventory, weakening consumer spending, increasing competition, and a maturing industry. Cooper says many Polaris Industries dealers are carrying high inventory, and in some cases they're having difficulties selling 2005 models. Additionally, the analyst believes Polaris' Ranger ATV, International, and motorcycle product lines will grow their revenues at lower rates due to competition and industry maturation. He cut his $3.70 2006 earnings per share estimate to $3.40 and his $45 price target to $38. He says that Polaris Industries joins Harley-Davidson (HDI
) (rated sell, with a $37 price target) as one of his two least favorites in the recreational vehicles industry.