Three leisure vehicle companies making an ascent

With rising disposable incomes these companies that make snowmobiles, ATVs, motorcycles, and personal watercraft could be good bets

Vikram Barhat 20 March, 2019 | 5:00PM

Rising disposable income in much of the world has created a favourable environment for the consumer cyclical sector. The trend has paved the way for long-term growth for the recreational vehicles industry in particular. The sunny outlook for the industry suggests this may be an opportune time for buy-and-hold investors to venture off the beaten track and look at some attractive opportunities in the powersport industry.

Companies operating in the arena of powersport and other recreational vehicles manufacture snowmobiles, all-terrain vehicles (ATVs), high-end motorcycles, and personal watercraft. These products are becoming increasingly popular for their aspirational value and as symbols of adventure coveted by thrill seekers.

U.S. ATV manufacturing has grown by 3.3% to rack up US$6 billion in revenue in 2018, according to an IBS World Report. The study forecasts ATV industry revenue to grow at a steady clip over the next five years, which it attributes to improving economic conditions and discretionary spending resulting from rising disposable income levels. In a similar trend, global snowmobiles market clocked 5.2% growth to swing back to growth trajectory, according to the International Snowmobile Manufacturers Association.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
BRP Inc69.67 CAD-5.57
Harley-Davidson Inc35.19 USD-1.90
Polaris Inc91.43 USD-3.27

About Author

Vikram Barhat

Vikram Barhat  Vikram Barhat is a Toronto-based financial writer specializing in investing, stock markets, personal finance and other areas of the financial services industry. He also writes for CNBC, BBC, The Globe and Mail, and Toronto Star.