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Analyst provides Arctic Cat quarterly update

In a research note titled “ACAT: Progress Good, But Still A Lot of Wood To Chop,” Wells Fargo Securities analyst Tim Conder reports that Arctic Cat CEO Christopher Metz “is accelerating inventory reduction plans, but broader strategic framework progress is needed to restore core momentum and investor confidence. FQ4 2015 outlook significantly reduced on inventory drawdown, international/FX overhang. CY2015 will largely be a cleanup year to work through channel inventories, improve quality and rebuild dealer relations. We believe dealers favorably view the inventory initiative. However, dealers will likely not become aggressive in building MY2016 product (August 2015) given the low probability of material “leap-frog” innovation vs. leaders Polaris and BRP.”

Conder notes that a formal “strategic outline expected at May 21st NY analyst meeting. Bottom Line: Move to clear channel positive, multiple fundamental issues still to address.”

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