HOG - Harley-Davidson rallies after BofA calls it a top SMID cap pick
Bank of America launches coverage on Harley-Davidson (HOG) with a Buy rating and calls it one of its top SMID Cap picks. The firm sees upside in international, electric and motorcycle profits. Analyst Robert Ohmes: "We believe HOG will trade at a premium to its historical multiple of 10-15X given: (1) potential 2021 EPS upside on new model dealer restocking and favorable Financial Services segment outlook; (2) accelerating brand momentum, supported by a reset to a 'Pull' market strategy (under new CEO Jochen Zeitz) and HOG’s highly anticipated launch into Adventure Touring (Pan America 1250 available at dealers in May); (3) newly established leadership in Electric motorcycles on success of the 'LiveWire' (in 2020) and the creation of a dedicated electric vehicle division; and (4) the LT opportunities for motorcycle division EBIT margin recovery to peak 15%+ (vs. 2021 guidance of 5-7%) and stronger International growth (incl. China)." The firm
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Harley-Davidson rallies after BofA calls it a top SMID cap pick