Last week, Harley-Davidson stock (HOG) continued to trade on a negative note for the second consecutive week. The stock ended the week with a fall of ~1.8%. As of August 13, the company’s stock was hovering in the negative territory quarter-to-date, with a 1.7% fall seen in the third quarter so far.
Fundamental weakness continues
Last month, Harley-Davidson’s management announced its second-quarter results. While its adjusted EPS for the quarter fell ~2% YoY (year-over-year) to $1.45, it managed to beat analysts’ consensus EPS estimate of $1.34.
In the second quarter, HOG’s total revenue fell 2.9% YoY to $1.71 billion, including a ~4% YoY fall in its Motorcycle segment’s revenue. The company’s global motorcycle shipments fell 11.3% YoY in the quarter, reflecting a weakening sales trend.
The operating profit margin in Harley’s Motorcycle segment contracted significantly to 16.0% in the second quarter from 20.1% a year earlier.
Weakness could continue
On August 13, HOG stock settled at $41.38, not far above its support level of near $40.90. Overall, its better-than-expected second-quarter earnings results could be one of the key reasons why its stock has been trading on a positive note in the third quarter so far. However, its weakening sales and its Motorcycle segment could keep its stock under pressure going forward.
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