Harley-Davidson (HOG) shares continued to decrease this week after a company’s quarterly sales fell brief of expectations Tuesday. That led to concerns about full-year income results.
The batch is down about 7% over a final 5 days and down about 1% in Friday trading.
From a technical perspective, Harley-Davidson batch competence be during levels where a short-term buy after new hits. From a long-term elemental perspective, there are dual things investors should watch: engines and a environment.
Shipments Hamstring a Stock
The good news came for Harley on a bottom line, where a first-quarter distinction of $1.05 per share surfaced Wall Street estimates of $1.02 a share. But that’s where a good title news flattering many ends.
Quarterly income was $1.33 billion. That’s down from $1.58 billion in a year-ago duration and subsequent accord estimates of $1.35 billion. Perhaps many importantly, motorcycle shipments fell 14.7% from a same entertain a year ago.
Harley did keep a 2017 superintendence of annual shipments constant, presaging it to be prosaic or down somewhat compared with 2016.
On Wednesday, RBC Capital Markets cut a cost aim on HOG to $57 from $60, citing diseased demand, according to Briefing.com. It lowered a expectations of 2017 shipments to -2% from no change.
Also on Wednesday, Wedbush cut a cost aim to $52 from $55, observant that operative by a overabundance of indication year (MY) 2016s was “a delayed and unpleasant process,” Briefing.com reported.
A day before, Goldman Sachs validated a Neutral rating on a batch and a cost aim of $54.
So, a batch is flattering many trade around a operation Wall Street says is satisfactory valuation. The batch is many closer to a 52-week high of a small some-more than $62 than a 52-week low of some-more than $42.
Engines or Environment
The trade operation could simply final until a subsequent gain report, as there aren’t poignant elemental catalysts on a calendar. But longer tenure there are dual moves a association is creation that investors should compensate courtesy to.
Are a new engines Harley-Davidson is touting as a game-changing creation able of bringing in converts?
The Milwaukee Eight is a poignant engine redesign and supplement unrestrained for a opening will be essential for shipments. Whether a new engine will be adequate to get stream riders to trade in their really arguable comparison models is a biggest doubt mark.
Over a subsequent 10 years, a association skeleton to launch 100 new motorcycles and pursue a electric motorcycle project.
Which brings us to this matter in a gain release.
Grow a business though flourishing a environmental impact.
Green might not be a tone many compared with severe and tough Harley, though it’s clearly a government priority.
“Preserving a roving sourroundings is critical to us,” a association pronounced in a many new Sustainability Report. “That’s because we’re building products that residence environmental issues while providing a kind of visceral, no-excuses roving knowledge a business expect.”
“We know there is a clever destiny for a normal products. An electric Harley-Davidson motorcycle is one of a ways we are exploring how to grow a different family of Harley-Davidson riders while assisting safety and replenish a leisure to float in a prolonged tenure proceed to sustainability.”
Translation? We have to safeguard that millennials also buy Harleys.
How does a environmental summary come opposite during a time when a domestic winds are clearly laissez-faire on environmental regulation? Maybe it rubs some normal Harley riders a wrong way, though that could be canceled out by a fact that a bikes are done in America.
is a Heavy contributor. He was formerly executive editor during TheStreet and hold comparison editorial positions during CNBC.com and MSN Money. He can be reached on Twitter during a hoop @DriftContinent.
April 21, 2017 12:29 pm