Harley Dealers Are Still Gloomy About Sales, Wedbush Says

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wordcount 528 wordcount|528 Photograph by Patricia De Melo Moreira/AFP/Getty Images Harley Dealers Are Still Gloomy About Sales, Analyst Reports Harley Dealers Are Still Gloomy About Sales, Analyst Reports Harley-Davidson Dealers Are Still Gloomy About Motorcycle Sales

The bike maker’s new lineup isn’t bringing in sales for dealers, according to a report by Wedbush Securities analyst James Hardiman.

Harley Dealers Are Still Gloomy About Sales, Wedbush Says

With less than a month left in the third quarter, dealers say their retail sales are down between 5%-10% from a year ago—and last year’s third-quarter sales were terribly weak.

https://www.barrons.com/articles/harley-davidson-stock-recall-1540305059 https://www.barrons.com/articles/harleys-electric-livewire-motorcycle-sales-decline-51562944452 https://www.barrons.com/articles/harley-davidson-new-electric-motorcycle-livewire-51563201864 https://www.barrons.com/articles/harley-davidson-uneasy-rider-1488000376? mailto:william.alpert@barrons.com Harley Dealers Are Still Gloomy About Sales, Analyst Reports By Bill Alpert Photograph by Patricia De Melo Moreira/AFP/Getty Images A Harley-Davidson motorcycle rally in June.

Harley-Davidson’s new motorcycle models include its first electric ride, the LiveWire. But the bike maker’s new lineup isn’t driving sales for its dealers, says a Monday morning report by Wedbush Securities analyst James Hardiman.

With less than a month left in the third quarter, dealers say their retail sales are down between 5%-10% from a year ago—and last year’s third-quarter sales were terribly weak.

“The question remains whether or not the company can spark a turnaround before the onset of the next recession,” writes Hardiman. He maintained his Neutral rating on Harley stock (ticker: HOG).

In late morning, the stock was up 3%, at $33.59, below Wedbush’s price target of $35. At nine times Hardiman’s forecast for 2020 earnings per share, the stock is dirt cheap—but it is hard to find ways the company can pull itself out of the dirt.

Harley declined to comment.

Apart from LiveWire, Harley’s new models represent modest updates to its product lineup. By Hardiman’s reckoning, the company priced its new offerings flat with its existing models. That is encouraging, because price increases in the last two years aggravated the gap between the cost of a new Harley and the ample supply of used bikes on the market.

LiveWire bikes have been late in arriving. Dealers expected their initial allotments in August, but now tell Wedbush they expect to see them later in September. The electric bikes will be in short supply, with only a handful allotted to each participating dealer. So when Harley gathers analysts for its annual investor meetup in Milwaukee later this month, it won’t have much evidence about LiveWire’s sales.

Read about our LiveWire test ride: We Test Drove Harley-Davidson’s New Electric Motorcycle

If dealers aren’t revved up about Harley’s new 2020 model year bikes, some hold out hope for next year’s introductions. Those include a new midprice “street” bike and an off-road touring model.

Still, optimism seemed scarce among Hardiman’s contacts. Dealers are struggling against a demographic shift in which Harley’s fans are aging and the younger generation hasn’t warmed to the company’s expensive rides.

“[M]any dealers wished the significant news wasn’t so far in the future,” Hardiman wrote, “while a few others remain skeptical that Harley can attract younger riders without a cheaper offering.”

Write to Bill Alpert at william.alpert@barrons.com

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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