Harley-Davidson could battle to increase its buyer base greater than buyers anticipate, Jefferies warned Tuesday. Analyst Anna Glaessgen initiated protection of the inventory as underperform with a value goal of $39, which means draw back of 18.6% over from Monday’s shut. Harley-Davidson shares dipped 1.7% within the premarket. “Merely put, we lack confidence within the go-forward demand trajectory for heavyweight motorbike segments,” she mentioned in a be aware to shoppers. “We see the ‘getting older out’ thesis as drained (‘getting older in’ is a generally neglected nuance), although we do not see a transparent catalyst for an acceleration in ridership development via 2030 as outlined by administration on the Could analyst day.” The model has come to outline American bikes, with demand this 12 months pushed by the long-cruiser life-style. Glaessgen mentioned Harley-Davidson has bought a sure “life-style” that aligns with American beliefs that has created loyalists. Within the fourth quarter, Harley-Davidson shares have shot up 38%, outpacing the S & P 500’s 10.4% acquire. The corporate has additionally seen margin enchancment that some argue is offering meat to the argument of a turnaround, Glaessgen mentioned. Harley-Davidson has surged 27.1% in 2022, making it one in every of few non-energy shares to put up double-digit optimistic development in a 12 months outlined by massive drops. New administration that has minimize prices and improved markets and per-unit revenue has helped buyers imagine within the inventory and gravitate in the direction of a story of it bucking broadly bearish market sentiment, Glaessgen mentioned. However Glaessgen mentioned “the latest retail inflection lacks legs,” noting those that are bullish on the inventory underestimate the problem of rising its shopper base. She is particularly involved about firm projections displaying development to the patron base going ahead will come partly from growth in e-motorcycles, as the corporate forecasts greater than 100,000 items in 2026. That is thought of too “optimistic” contemplating the corporate registered below 200,000 new bikes in whole in 2021. “We imagine ridership development and growth past the core might be simpler mentioned than performed,” she mentioned. “We see outsized execution danger to important strategic shift stemming from Harley’s loyal base, who like Harley simply the best way it’s.” The corporate expects greater than 700,000 gross provides per 12 months in 2022 via 2023 in comparison with round 600,000 in 2012 via 2021, so a miss on e-motorcycles may sink broader development expectations. These development hopes will probably even be tempered by elevated competitors within the e-motorcycle division in addition to shopper spending modifications throughout a recessionary interval. Shoppers have already got more and more shifted spending away from big-ticket items to providers after two years of pandemic-induced shopping for. And plenty of have rolled again spending as issues over inflation and a possible recession mount. — CNBC’s Michael Bloom contributed to this report.
.jpeg?itok=EJhTOXAj'%20%20%20og_image:%20'https://cdn.mises.org/styles/social_media/s3/images/2025-03/AdobeStock_Supreme%20Court%20(2).jpeg?itok=EJhTOXAj)
