Earnings Preview: Harley-Davidson

Apr.19.10 | About: Harley-Davidson, Inc. (HOG)

Harley-Davidson (NYSE:HOG) is expected to report Q1 earnings before the market open on Tuesday, April 20 with a conference call scheduled for 9:00 am ET.


Analysts are looking for a profit of 24c on revenue of $1.02B. The consensus range is 3c-39c for EPS, and revenue of $914.3M-$1.21B, according to First Call. In January, the company forecast motorcycle shipments down 5%-10% for FY10, and said it expects to ship 201,000-212,000 motorcycles this year. CEO Keith Wandell noted that the company expects 2010 will continue to be a challenging year. Harley-Davidson was also the subject of LBO speculation this quarter, and Breakingviews said Kohlberg Kravis was named as a potential suitor. Breakingviews believes the idea of KKR or another buyout firm looking into Harley-Davidson "isn’t entirely crazy."

Analyst Views

Harley-Davidson shares were recently downgraded to Hold from Buy at Deutsche Bank. The firm says that while the stock's long-term valuation is still "reasonable," further upside requires a "meaningful" recovery in motorcycle demand; the firm believes motorcycle demand will remain at 2009 levels "for some time." A growth driver could be an improvement in Harley's Financial Services unit, or higher than forecast proceeds from the sale of MV Augusta.