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Harley-Davidson (HOG) Beats Q2 Earnings, Cuts Guidance

Harley-Davidson Inc. HOG is the world's leading designer and manufacturer of heavyweight motorcycles and related products and merchandise. The large market share provides scale advantages over most competitors. Furthermore, the company maintains an extremely strong franchise. It is also expanding its product portfolio to increase its customer base.

However, Harley-Davidson has been facing challenges like heavy discounts by competitors and unfavorable foreign currency exchange. The company has also been struggling to increase the operating income of the Financial Services segment.

Estimate Trend & Surprise History

Investors should note that the second-quarter earnings estimate for Harley-Davidson inched down by a cent over the last 7 days. However, the company has a track record of delivering positive earnings surprises. It has beaten the Zacks Consensus Estimate in 3 of the trailing 4 quarters with an average beat of 3.53%. Investors have been eagerly awaiting Harley-Davidson's latest earnings report to see whether it outperforms this time as well.

HARLEY-DAVIDSON Price and EPS Surprise

HARLEY-DAVIDSON Price and EPS Surprise | HARLEY-DAVIDSON Quote

Zacks Rank

Harley-Davidson currently has a Zacks Rank #3 (Hold), but that could change following its earnings report which was just released. We have highlighted some of the key stats from this Wisconsin-based motorcycle manufacturer's earnings announcement below:

Earnings Beat Estimates

Harley-Davidson raked in earnings of $1.55 per share that surpassed the Zacks Consensus Estimate of $1.53. Further, earnings were higher than $1.44 recorded in the year-ago quarter.

Revenues Meet Estimates

Revenues from Motorcycles and Related Products improved to $1.67 billion in second-quarter 2016 from $1.65 billion in the year-ago quarter. The figure was in-line with the Zacks Consensus Estimate.

Harley-Davidson logged consolidated revenues of $1.86 billion, which improved from $1.82 billion posted a year-ago.

Key Stats/Developments to Note

Harley-Davidson reduced its guidance for motorcycle shipments in 2016 to 264,000-269,000 units from the prior range of 269,000-274,000 units. This implies that the year over year change in shipments will vary between a decline of 1% and a rise of 1%. The lower guidance is due to softness in the U.S. market, high competition and global economic uncertainty.

In the third quarter of 2016, Harley-Davidson expects to ship 48,500 to 53,500 motorcycles, compared with 53,472 motorcycles shipped in the year-ago period.

Market Reaction

Harley-Davidson's shares have remained inactive so far following the release. It would be interesting to see how the market reacts to the results during the trading session today.

Check back later for our full write up on Harley-Davidson's earnings report!

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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