On Friday, Citi adjusted its stance for Harley-Davidson (NYSE:HOG) stock, a renowned motorcycle manufacturer and adjusting the price target to $36 from the previous $40, while maintaining a Neutral stance. The revision follows the company's recent performance, which did not meet market expectations in several key areas.
According to the firm, Harley-Davidson's domestic retail sales were slightly disappointing, but it was the global retail figures that fell markedly short of projections. Additionally, the company's margin performance did not meet the anticipated standards. Despite these setbacks, Harley-Davidson's management maintains that the outcomes were in line with their internal forecasts.
Citi's report highlights that the future outlook presented by Harley-Davidson's management remains positive, projecting an improvement over the next one to two quarters. However, the firm notes that the responsibility to validate this optimistic forecast rests with the company's leadership.
The updated price target reflects these concerns, as well as the importance of retail demand in determining the company's guidance for 2024 and the potential shift in long-term retail trends.
The analyst from Citi emphasized the critical role of retail demand in both the short-term perspective for the 2024 guidance and the more significant, long-term narrative surrounding retail challenges.
InvestingPro Insights
For investors considering Harley-Davidson's stock, recent InvestingPro insights may provide additional context. The company has a market capitalization of $4.47 billion and is trading at an attractive earnings multiple with a P/E Ratio (Adjusted) of 6.33 as of the last twelve months ending Q4 2023. This could indicate that the stock is undervalued compared to its earnings.
Additionally, Harley-Davidson's management has shown confidence in the company by aggressively buying back shares and raising its dividend for three consecutive years, with a current dividend yield of 2.08%. The InvestingPro Tips also highlight that analysts have recently revised their earnings expectations upwards for the upcoming period, suggesting potential optimism about the company's financial performance.
For those interested in a deeper analysis, InvestingPro offers 8 additional tips on Harley-Davidson. To explore these insights and make more informed investment decisions, readers can use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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