Steve Jobs denies that Apple has been involved in discussion with H-D over a Harley-Davidson version of the iPod and downloadable Harley exhaust samples on iTunes. "That would be a stupid idea," Jobs said.
Which is the same thing he said awhile back about a the idea of a video iPod.
Lets see...an American Company has a 15.15 P/E ratio,is projected to sell a record 329000 units this year and has plans (incredible to me) to sell another 350000 units and the prophets are screaming doom and gloom. If this was happening 10 years ago, the prophets would be screaming BUY BUY and HD stock would soar until the P/E was in the 40/50 range. I think the concerns are more based on uncertainties regarding the effect of oil prices on the economy and concern that this will cause a reduction in discretionary funding than concerns about HD itself. I believe the concerns are justified and HD will probably not meet their 06 goals of 350000. However,HD is still a strong company and it is way too soon to predict a collapse. HD was an immensely profitable company whenn they sold 200000 units and can survive a slip. The challenge is to maintain enough profitability to enable it to develop new products to attract new buyers when the current buyers start retiring. They have a decent start with the Buell and VROD but need to do more to counter the rise of the Metric cruisers.
By the way its interesting to note that Polaris (the Victory parent company)stock also is way down from its March high,even though its sales are rising and their P/E ratio is a respectable 17.:1. The immediate future of both companies (and many others) depends a lot on the effect of oil prices on the economy(especially as winter approaches) and consumer confidence
I hate the stock market. One idiot screams that the company is going to bankrupt, and the world of knee-jerking day traders SELL SELL SELL. Prices drop. It's a stupid domino effect to judge a companies true performance by, and more so, it's stability.
At least in the US, H-D owns the cruiser market. Most non-motorcyclist types refer to all cruisers as "Harley's". Just as some people still refer to soda drinks as "Coke" even if it is a Pepsi. You only get that kind of product recognition by being the oldest. H-D riders are very loyal, to a fault even.
Before I would get the marshmellows out for the roasting of H-D, I would expect to see them lower MSRPs in a last ditch effort to compete in a market where their name is not enough to justify their price. Also they would probably sell the licence for their clothing line, in an attempt to re-focus on the process of making motorcycles. But they still sell, some would argue better than ever, so their name is more than enough to get them by at this point.
I personally like sportbikes, not cruisers, but I really don't see H-D falling anytime soon. Just my 2 cents.
Price to earniongs ratio........in other words if my stock price goes up but my earnings stay the same,the P/E ratio goes up. The lower the ratio,the better buy the stock is(at least thats the basic theory) But good point, this is a motorcycle forum,not a stock market forum. Another point is that ever since the tech bubble of the 90's, the market has not been rational and traditional indicators dont necessarily foretell whats gonna happen to the stock. Bottom line at this time is: HD is a strong company facing challenges due to an aging customer base and uncertain economy related to high fuel prices. How well they rise to the challenge remains to be seen....many other US companies face similiar challenges.
Yep good analysis. It's undervalued! At the current P/E ratio the stock price can rise quite a bit to get to the standard watermark of 20. Damn too bad I sold my stock and the kid's scholarship only covered tuition.
Can't believe they are saying uncertainty about gas prices has any effect on whether or not someone would buy a H-D.
If I understand correctly every single model from Harley has about the same fuel economy as a Toyota Prius and they generally beat the higher powered foreign bikes.
Why not reconsider the pickup truck or SUV purchase and just get the H-D.
The other weird thing about the stock market here is that if H-D is making profits why worry. Investors are so incredibly greedy these days. Even if H-D shrunk in size, if they reduced inventory and production by an appropriate amount they could maintain profits and continue to do well.
I think the gas price rational is that if gas continues to rise, people will spend more on gas and less on toys. Most Americans don't use bikes as a primary means of transport. When money gets tight, boats and bikes are often the first things to go.