Shares of Polaris Industries (PII 0.48%) were up 10.8% as of 3 p.m. EDT Tuesday after the off-road vehicle and motorcycle specialist announced strong quarterly results.
More specifically, third-quarter adjusted sales grew 7% year over year to $1.772 billion. That translated to adjusted net income of $104 million, or $1.68 per share, down from $118 million, or $1.86 per share a year ago. Keeping in mind Polaris doesn't usually provide specific quarterly guidance, most analysts were expecting lower earnings of $1.58 per share on slightly higher revenue of $1.79 billion.
"Through the strength of our brand portfolio and solid execution from our team, Polaris delivered 7 percent revenue growth and modest margin expansion amid mounting macroeconomic ambiguity," CEO Scott Wine said.
As such, for the full year of 2019, Polaris now believes sales growth will arrive at roughly 12%, near the bottom end of its previous 12% to 13% target range. But it also anticipates 2019 earnings per share ranging from $6.20 to $6.30, an improvement from previous guidance of $6.10 to $6.30.
In the end, it seems the market was more than willing to forgive Polaris' slight top-line shortfall in favor of focusing on its outsize profitability. Given persistent concerns over the impact of foreign trade and tariffs, the stock is understandably responding in kind today.