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Harley-Davidson: A Piece Of Americana On Sale

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from https://seekingalpha.com Summary Harley-Davidson has the power of a strong brand name that resonates well with consumers. While it’s had its fair share of recent challenges, I’m encouraged by the company’s turnaround efforts being led by its new CEO. I expect the company to benefit from an increased need for outdoor recreation, and see the shares as undervalued. During the current COVID-19 environment, technology stocks seem to get all of the glory. However, I believe that by looking beyond the headlines, one can find value in stocks that are positioned to benefit from the current environment. One such stock that I see is Harley-Davidson (HOG), which is a well-recognized, classic American company. In this article, I evaluate what makes this an attractive investment at the current valuation; so let’s get started. Looking Into Harley-Davidson There are perhaps few companies that spell Americana more than Harley-Davidson. Its iconic brand is synonymous with motorcycles and is loved by enthusiasts in the U.S. and around the world. Its loyal customer base like the fact that the bikes are highly customizable, therefore making each bike their own personal expression. What I like about the company is that its brand transcends beyond just the product, and into a feeling. Emotions play a huge role behind consumers’ large discretionary purchases, and this is exemplified by the following quote from the company:’ The current environment, however, has not been kind to Harley. Revenue was down by 47% YoY in the latest quarter due to lower shipments, and the company posted a net loss of -$1.83 per share. This was due to a combination of restructuring charges and the fact that nearly 60% of its global dealer network was closed back in April. In addition, Harley had lingering issues with a bloated cost structure and an inefficient supply […]

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Harley in talks with Hero for distribution deal after exiting India

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by Aditya Kalra & Aditi Shah from Reuters and https://www.business-standard.com Harley, known for its heavy touring motorcycles, struggled in India mainly because of high import duties. Harley’s 33 dealerships will likely come under Hero’s management under the new arrangement, said one of the sources. Harley-Davidson Inc is in advanced talks with India’s Hero MotoCorp for a distribution deal which will allow the U.S. firm’s iconic motorcycles to be sold in India, after it stops local manufacturing there, three sources told Reuters. The Milwaukee-based company said on Thursday it will stop sales and shut its manufacturing plant in India, effectively abandoning the world’s biggest motorcycle market after a decade of unsuccessful efforts to gain a foothold. Harley however is in talks with Hero MotoCorp to enter into a distribution arrangement that will allow the Indian company to import and sell Harley bikes as its sole distributor, two sources with familiar with the talks said. “Hero will be the master distributor for Harley bikes in India … This will be a partnership, a strategic alliance,” said one of the sources, all of whom declined to be named as the discussions were private. Discussions are also ongoing to let Hero become a contract manufacturer for at least one Harley motorcycle with 300-600 cc engine capacity, which it will launch later, the first source added. The financial details of the deal were not immediately clear. Asked about talks with Hero, a Harley spokeswoman said the company can’t comment on “rumours or speculation”. On Thursday, it said it was “changing its business model in India & evaluating options to continue to serve customers.” Hero MotoCorp, which is the India’s largest two-wheeler manufacturer by sales, said it doesn’t comment on market speculation. It produced 6.4 million two-wheeler scooters and motorcycles in the fiscal year ending March

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Harley plans to hitch a ride with two-wheeler makers

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from Lijee Philip from https://economictimes.indiatimes.com Harley plans to hitch a ride with two-wheeler makers, Classic Legends, Hero Motocorp frontrunners Mahindra’s Classic Legends could be the obvious choice for the iconic leisure bike making company as it aligns very well with M&M’s approach of catering to the premium end of the market with marquee brands , and for Harley, it gets a local company with a large manufacturing facility and an established local supply chain. After its global restructuring efforts to make Thailand its main hub for Asia Pacific, Harley Davidson is now understood to be exploring potential collaborations with Indian two-wheeler makers. The two possible names doing the rounds are Mahindra NSE -0.82 %’ subsidiary Classic Legends and Hero Motocorp NSE -1.89 %. The potential Indian alliance partners could do contract manufacturing for Harley Davidson in the mid-size motorcycle space – in line with Bajaj-KTM or TVS-BMW. Mahindra’s Classic Legends could be the obvious choice for the iconic leisure bike making company as it aligns very well with M&M’s approach of catering to the premium end of the market with marquee brands , and for Harley, it gets a local company with a large manufacturing facility and an established local supply chain. Classic Legends was established to re-introduce iconic marquee motorcycle brands in the market and currently retails the Jawa motorcycle brand also owns iconic brands like BSA & Yezdi. While it started of with impressive sales numbers, delays in deliveries and quality issues makes it difficult for the company to meet the growing demand. Hero Motocorp has stated that it’s open to partnerships to get a stronger foothold in the premium segment. Market leaders in entry level/commuter and the 125cc segments, it lacks premium bike building capability. After several attempts, Hero has finally managed to break-into 200 cc segment

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Harley’s activist investor backs business reboot strategy

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by Rajesh Kumar Singh from https://www.reuters.com CHICAGO (Reuters) – An activist investor who shook up Harley-Davidson Inc (HOG.N) earlier this year said he is impressed with the changes initiated by new Chief Executive Jochen Zeitz to turn around the 117-year-old motorcycle company. Impala Asset Management, the $2.4 billion hedge fund, pushed for the ouster of Zeitz’s predecessor Matt Levatich in January. Months later, it tried to install two directors on Harley’s board, asking for operational fixes to recover its market share in the United States, Europe and Japan. “For the first time in five to six years, the company is on the right track again,” Bob Bishop, founder and chief investment officer at Impala, told Reuters. Zeitz, who took the reins in February, is rebooting Harley’s business by shifting the focus back to big bikes, traditional markets like the United States and Europe, and older and wealthier customers. The new strategy echoes some of the changes Impala has been pushing for. Bishop said Harley should not pursue sales growth at any cost. Instead, it needs to market itself like Ferrari and become an “aspirational” brand, he added. Bishop does not buy the argument that Harley’s sales in the United States – its biggest market – are suffering because of an aging customer base. He dubbed that an “excuse” to cover the company’s shrinking market share, citing evidence from Europe and Japan where industry sales of motorcycles have been growing despite older demographics. “When you build up the brand, you will sell more bikes,” Bishop said. “Get rid of this idea that the demographics is killing them.” Impala bought 1.2 million Harley shares in the quarter through June, increasing its stake to 2.52% from 1.73% in the first quarter of the year. It also expects an agreement with Harley next month

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Royal Enfield captures UK motorcycle market with Interceptor, Himalayan

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from https://timesofindia.indiatimes.com LONDON: Royal Enfield has made deep inroads in the UK market two of its popular and purpose-built motorcycles – Interceptor 650 and Himalayan. The Royal Enfield Interceptor 650 is the best selling motorcycle in the UK for June 2020 (in the more than 125-cc category) while the Interceptor 650 is the highest selling motorcycle in the UK in the middleweight segment for the last one year (250cc – 750cc; June 2019 to June 2020). Royal Enfield Interceptor 650 is a commuter bike available in three variants in India priced between Rs 2.65 lakh and 2.85 lakh (ex-showroom). Royal Enfield Interceptor 650 is powered by 648-cc, double cylinder engine that generates 49 PS of power and 52 Nm of torque. The double cylinder engine of Interceptor 650 has a 6-speed manual gearbox. With both rear and front disk brakes. The Royal Enfield Himalayan has redefined adventure touring and managed to carve a niche within the adventure-touring segment. Inspired by Royal Enfield’s 60 years of enduring history in its spiritual home – The Himalayas – the motorcycle has been an accessible and engaging option for riding enthusiasts. Royal Enfield Himalayan generates 26.3 PS of power and 32 Nm of torque from its 411cc engine. It costs between Rs 1.90 lakh and Rs 1.94 lakh (ex-showroom). Vinod K Dasari, CEO Royal Enfield said “Since its launch, the Interceptor 650 has been gaining momentum among consumers, and has won several awards globally. Dominating the mid-segment in the UK for a year is a truly remarkable achievement that we are very proud of. We are equally delighted with the success of our adventure-tourer Himalayan which has been among the top 5 best selling middle-weight motorcycles in the UK consistently over the last 12 months. This response from our customers in the UK has

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The Travelers Bikernet Weekly News for July 23, 2020

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Alerts and News that Will Blow Your Mind! Hey, This coming week is going to be a strange one. I know the whole world is trying to grapple with this Covid mess, while I hide out in the Badlands surrounded by peace and nirvana, deer and pine trees. We are still two weeks from the rally, but tourist and bikers are everywhere. This morning five of our bikes are being delivered to the Bikernet Covid Hide-Out in the Badlands by Haul Bikes. I’ve got the shop set up and ready for minor repairs and already have a brazing project on the bench, maybe two. Every day is exciting when it involves motorcycles. My grandson is trying to coerce a couple of buddies to ride from LA to Sturgis to escape the madness and mayhem. It’s interesting. When we need fresh air, fresh outlooks, or new adventures, just mount up and ride. Let’s hit the news. The Bikernet Weekly News is sponsored in part by companies who also dig Freedom including: Cycle Source Magazine, the MRF, Las Vegas Bikefest, Iron Trader News, ChopperTown, BorntoRide.com and the Sturgis Motorcycle Museum. Most recently Quick Throttle Magazine came on board. CLICK HERE TO READ THE NEWS ON BIKERNET Join the Cantina – Subscribe Now https://www.bikernet.com/pages/custom/subscription.aspx

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Harley-Davidson Racks Up Buy Ratings on Bets New CEO Can Turn Things Around

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by Christiana Sciaudone from https://www.investing.com/ Harley-Davidson (NYSE:HOG) has swayed yet another analyst that a turnaround will bear fruit. Shares are up 4.5% on Wednesday after UBS followed BMO Capital in upgrading the motorcycle maker. UBS bumped its rating to buy from neutral and gave Harley-Davidson a price target of $31, Seeking Alpha reported. The average price target of analysts tracked by Investing.com is $26.75. The stock has seven buys, 10 holds and one sell. It was trading around $28.60 during the morning session. On Tuesday, BMO raised HOG to outperform from market perform and boosted its price target to $33 from $23, MarketWatch reported. New Chief Executive Officer Jochen Zeitz, named in May, is expected to drive much-needed change at the company. Shares are trading at a price-to-earnings ratio of 11, versus 16 for the average long-term ratio of the Dow Jones, according to data compiled by Investing.com and Zacks Investment Research. Last week, Harley-Davidson said it would cut 700 positions across global operations, with about 500 expected to exit in 2020. The chief financial officer also exited the company at the time. Harley-Davidson said it is overhauling its global operating model to become a “leaner, more nimble” organization. Harley-Davidson’s stock surges toward a 4-month high after Morgan Stanley raises rating, price target by Tomi Kilgore from https://www.marketwatch.com Shares of Harley-Davidson Inc. HOG, +5.51% shot up 4.8% toward a four-month high in morning trading Wednesday, after UBS analyst Robin Farley turned bullish on the motorcycle maker, citing an upbeat outlook on margins over the next couple years. Farley raised his rating to buy, after being neutral for at least the past three years, and raised his stock price target to $31 from $24. He said he believes Harley could help boost margins by eliminating growth initiatives, as they were losing

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Harley-Davidson Rallies on BMO Upgrade, Expected Turnaround

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by Christiana Sciaudone from https://www.investing.com Harley-Davidson (NYSE:HOG) shares rose 5% after an upgrade by BMO Capital. HOG was raised to outperform from market perform by analyst Gerrick Johnson, who also boosted his price target to $33 from $23, MarketWatch reported. The average price target is $26.75, while the highest is $34, according to data compiled by Investing.com. The stock was trading around $27.28 on Tuesday. Johnson is more positive on the motorcycle maker thanks to management changes and the “high level of credibility” that Chief Executive Officer Jochen Zeitz has brought to the company. While retail sales may not recover quickly, key metrics like used bike prices and dealer inventory levels should improve, showing proof of a turnaround, MarketWatch quoted Johnson as saying. Last week, Harley-Davidson said it would cut 700 positions across global operations, with about 500 expected to exit in 2020. The company said it is overhauling its global operating model to become a “leaner, more nimble” organization. HOG has seven buy ratings, 10 holds and one sell, according to data compiled by Investing.com. Harley-Davidson’s stock surges after BMO Capital upgrades, raises price target to highest in the Street by Tomi Kilgore from https://www.marketwatch.com Shares of Harley-Davidson Inc. HOG, +5.55% hiked up 3.4% in premarket trading Tuesday, after BMO Capital’s Gerrick Johnson became the most bullish analyst covering the motorcycle maker following an upgrade and price target boost. Johnson raised his rating to outperform from market perform and lifted his stock price target to $33, which is 27% above Monday’s closing price of $25.92, from $23. His target is now the highest of the 19 analysts surveyed by FactSet. Johnson said he’s more positive on the company after recent management changes, as new Chief Executive Jochen Zeitz has brought in “a high level of credibility” that investors have

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Motorcycles Sales Bounce Back Post Pandemic Slump

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by Sabrina Giacomini from https://www.rideapart.com Rising from the ashes. To say that 2020 has been an eventful year so far is an understatement. “2020, written by Stephen King” is probably the best description of this year’s events we found so far. Of course, with a pandemic forcing most of the global population into lockdown, the health crisis was bound to have an impact on the motorcycle industry. For several manufacturers, between suspended production and customers shying away from the dealers, the months of April and May 2020 have been challenging to say the least. Thankfully, with life gradually resuming, so are sales, and the numbers are bouncing back. Things Are Going Better Than Expected: An increasing number of people and publications suggest that the pandemic will encourage more people to turn to motorcycles and scooters for transportation—the perfect type of commuter for social distancing. In the U.S., buyers didn’t waste any time running for the hills—literally—as soon as COVID-19 poked its ugly head. Honda, BMW, Suzuki, and Yamaha’s North American branches reported that sales are thriving since the beginning of the year, particularly in the off-road segment. For instance, American Honda Motor Co. confirmed that motorcycle sales for May 2020 have more than doubled over May 2019—both in the road and off-road segments (+103% and +172% respectively). For BMW North America, while official sales numbers were not disclosed, the spokesperson did say that May 2020 sales were far exceeding last year’s. The European market is showing a similar, positive trend. Italian sales numbers for June 2020 show a 37-percent increase over June 2019—not even over the catastrophic month of May 2020. More bikes and scooters sold in Italy post-pandemic than last year, back when nobody had even heard of a coronavirus. A total of 39,085 motorcycles, scooters, and mopeds have

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NCOM Biker Newsbytes June 2020

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Compiled & Edited by Bill Bish QUOTABLE QUOTE: “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.” ~ Sun Tzu (544-496 BC), Chinese Military Strategist, authored “The Art of War” ABOUT AIM / NCOM: The National Coalition of Motorcyclists (NCOM) is a nationwide motorcyclists rights organization serving over 2,000 NCOM Member Groups throughout the United States, with all services fully-funded through Aid to Injured Motorcyclist (AIM) Attorneys available in each state who donate a portion of their legal fees from motorcycle accidents back into the NCOM Network of Biker Services (www.ON-A-BIKE.com / 800-ON-A-BIKE). CLICK HERE TO READ THE NEWS FROM NCOM AT BIKERNET Join the Cantina – Subscribe Today https://www.bikernet.com/pages/custom/subscription.aspx

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