Harley-Davidson: 4 Different Insiders Have Sold Shares This Month

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

In this article, I will feature one consumer stock that has seen intensive insider selling during the last 30 days. Intensive insider selling can be defined by the following three criteria:

  1. The stock was sold by three or more insiders within one month.
  2. The stock was not purchased by any insiders in the month of intensive selling.
  3. At least two sellers decreased their holdings by more than 10%.

Harley-Davidson (NYSE:HOG) manufactures heavyweight cruiser and touring motorcycles.

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Insider selling during the last 30 days

Here is a table of Harley-Davidson's insider-trading activity during the last 30 days by insider.

Name Title Trade Date Shares Sold Rule 10b5-1 Current Ownership Decrease In Ownership
Paul Jones VP Feb 7 30,000 No 11,620 shares + 42,352 options 35.7%
Keith Wandell CEO Feb 6 50,000 No 190,935 shares + 584,968 options 6.1%
Tonit Calaway VP Feb 6-7 11,124 No 10,911 shares + 34,542 options 19.7%
Joanne Bischmann VP Feb 6-7 2,323 No 11,313 shares + 60,033 options 3.2%
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There have been 93,447 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of Harley-Davidson's insider-trading activity by calendar month.

Month Insider selling / shares Insider buying / shares
February 2014 93,447 0
January 2014 0 0
December 2013 0 0
November 2013 1,006 0
October 2013 8,883 0
September 2013 0 0
August 2013 122,225 0
July 2013 0 0
June 2013 0 0
May 2013 0 0
April 2013 0 0
March 2013 0 0
February 2013 37,469 0
January 2013 15,612 0
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There have been 278,642 shares sold, and there have been zero shares purchased by insiders since January 2013.

Financials

Harley-Davidson reported the full-year 2013 financial results on January 30 with the following highlights:

Revenue $5.9 billion
Net income $734.0 million
Cash $1.2 billion
Debt $5.3 billion
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(Source: Earnings presentation)

Outlook

Harley-Davidson expects to ship 279,000 to 284,000 motorcycles to dealers and distributors worldwide in 2014, an approximate 7% to 9% increase from 2013 shipments. In the first quarter of 2014, the company expects to ship 76,500 to 81,500 motorcycles, compared to 75,222 motorcycles shipped in the year-ago period.

(Source: Earnings presentation)

Competition

Harley-Davidson's competitors include Honda Motor Company (NYSE:HMC), Suzuki Motor (OTCPK:SZKMF), Yamaha Motor (OTCPK:YAMHF), and Kawasaki Heavy Industries (OTCPK:KWHIY). Here is a table comparing these companies.

Company HOG HMC SZKMF YAMHF KWHIY
Market Cap: 14.25B 65.75B 14.70B 4.45B 27.83B
Employees: N/A 190,338 N/A N/A N/A
Qtrly Rev Growth (yoy): 0.02 0.25 0.19 0.24 0.49
Revenue: 5.90B 146.01B 34.58B 17.10B 16.82B
Gross Margin: 0.36 0.26 N/A N/A N/A
EBITDA: 1.32B 17.66B 3.40B 939.54M 1.44B
Operating Margin: 0.20 0.06 0.06 0.03 0.05
Net Income: 733.99M 6.09B 1.15B 248.13M 442.37M
EPS: 3.28 3.38 1.96 0.71 0.27
P/E: 19.69 10.79 13.40 17.92 62.83
PEG (5 yr expected): 1.04 N/A N/A N/A N/A
P/S: 2.43 0.45 0.42 0.26 1.68
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Harley-Davidson has the highest P/S ratio among these five companies.

Conclusion

There have been four different insiders selling Harley-Davidson, and there have not been any insiders buying Harley-Davidson during the last 30 days. Two of these four insiders decreased their holdings by more than 10%. Harley-Davidson has an insider ownership of 0.10%.

Harley-Davidson has a $51 price target from the Point and Figure chart. I believe there is an opportunity for a short entry with the $51 price target. I would place a stop loss at $70, which is the all-time high. The three main reasons for the proposed short entry are bearish Point and Figure chart, relatively high P/S ratio, and the intensive insider-selling activity.

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Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in HOG over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.