HOG - Harley-Davidson strategy update fails to kickstart shares

Based on talks with investors, Morgan Stanley says it sees four reasons Harley-Davidson (HOG) plummeted 17% yesterday after its five-year strategy update. "1) the reveal seen as a 'sell the news' event, 2) a realization that this is a longer term turnaround and earnings estimates will fall near term, 3) long-term secular headwinds around declining motorcycle ridership still persisting, and 4) a lack of granular detail and disclosure around certain line items with a path to get to 10% motorcycle EBIT margins, long term." MS is keeping an Equal-weight rating on HOG until it can see proof that management is executing with the turnaround strategy. Harley-Davidson earnings call transcript Details on Harley's five-year plan.

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Harley-Davidson strategy update fails to kickstart shares