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Post Earnings Coverage as Harley-Davidson's Quarterly EPS Surpassed Estimates

Upcoming AWS Coverage on Polaris Industries Post-Earnings Results

LONDON, UK / ACCESSWIRE / April 24, 2017 / Active Wall St. announces its post-earnings coverage on Harley-Davidson, Inc. (NYSE: HOG). The Company posted its first quarter fiscal 2017 results on April 18, 2017. The motorcycle maker reported a y-o-y decline in sales and earnings. Register with us now for your free membership at:


One of Harley-Davidson's competitors within the Recreational Vehicles space, Polaris Industries Inc. (NYSE: PII), announced on March 27, 2017, that it will release its Q1 2017 financial results on Tuesday, April 25, 2017, and will hold a webcast and conference call at 9:00 a.m. CT on the same day to discuss the results. AWS will be initiating a research report on Polaris Industries in the coming days.

Today, AWS is promoting its earnings coverage on HOG; touching on PII. Get our free coverage by signing up to:


Earnings Reviewed

For the three months ended March 26, 2017, Harley-Davidson reported revenue of $1.33 billion, down from $1.58 billion in Q1 FY16. The Company's revenue numbers came in below analysts' consensus of $1.37 billion.

For Q1 FY17, Harley-Davidson reported net income of $186.4 million, or $1.05 per share, compared to net income of $250.5 million, or $1.36 per share, in the year-earlier same period. The Company's earnings surpassed Wall Street's forecasts of $1.02 per share.

"First quarter US retail sales were in line with our projections and we remain confident in our full-year plan despite international retail sales being down in the first quarter," said Matt Levatich, CEO, Harley-Davidson, "We are very pleased with our continued growth in US market share and the progress our US dealers made in reducing their inventory of 2016 motorcycles in the quarter."

Motorcycle Sales Details

For Q1 FY17, worldwide Harley-Davidson retail motorcycle sales declined 4.2% to 55, 049 units compared to motorcycle sales of 57,458 units in Q1 FY16. In-line with the Company's expectations, Harley-Davidson retail motorcycle sales in the US declined 5.7% on a y-o-y basis to 33,316 units. US retail sales were adversely impacted by weak industry sales and limited availability of model year 2017 motorcycles, partially offset by strong sales of the Company's Milwaukee-Eight touring bikes and its focus on growing ridership. Harley-Davidson's US market share for the reported quarter was 51.3% in the 601cc-plus segment, up compared to Q1 FY16.

For Q1 FY17, Harley-Davidson's international retail sales totaled 21,733, down 1.8% compared to Q1 FY16 sales of 22,132 units. The Company's International retail sales were below its expectations driven by weak sales in Asia/Pacific, partially offset by strong growth in Latin America. In Asia/Pacific, Q1 retail sales were down 9.3% from last year. Sales were adversely impacted by softness in the Company's emerging markets and in Japan. Harley-Davidson's sales in India continue to be down in the high double digits due in large part to the continued impact of last quarter's demonetization Harley-Davidson expects Asia/Pacific region to return to growth in the back half of 2017, largely behind expanded distribution, the introduction of the new Street Rod and increased marketing spending for the remainder of the year. Retail sales in Latin America were up 24.2% in Q1 compared to the year-ago decline of 26.5%.

Harley-Davidson's average motorcycle revenue per unit was down $342 for Q1 FY17 as the Company shipped fewer touring bikes, partially offset by the impact of higher pricing. Parts and Accessories and General Merchandise revenues were down for the quarter due in large part to lower motorcycle shipments and lower retail motorcycle sales.

Financial Details

As of March 26, 2017, Harley-Davidson's cash and marketable securities totaled $844.7 million compared to $739.1 million in the year ago comparable period. Harley-Davidson generated $159.9 million of cash from operating activities in the reported quarter compared to $41.1 million in the year earlier same quarter. The Company paid a cash dividend of $0.365 per share for Q1 FY17, up 4.3% on a y-o-y basis. On a discretionary basis, the Company repurchased 1.2 million shares of its common stock during the reported quarter for $70.9 million. At the end of the first quarter, 18.0 million shares remained on a board-approved share repurchase authorization.


For FY17, Harley-Davidson continues to anticipate full-year motorcycle shipments to be flat to down modestly in comparison to 2016. In Q2 FY17, the Company expects to ship approximately 80,000 to 85,000 motorcycles. Harley-Davidson continues to expect full-year 2017 operating and gross margin as a percent of revenue to be approximately in-line with 2016.

The Company continues to expect that full-year 2017 capital expenditures to be in the range of $200 million to $220 million.

Stock Performance

Harley-Davidson's share price finished last Friday's trading session at $55.81, sliding 1.17%. A total volume of 2.91 million shares exchanged hands, which was higher than the 3 months average volume of 2.20 million shares. The stock has rallied 3.18% and 19.35% in the last six months and past twelve months, respectively. The stock is trading at a PE ratio of 15.94 and has a dividend yield of 2.62%.

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SOURCE: Active Wall Street