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Harley-Davidson, Inc. (HOG - Free Report) reported third-quarter adjusted earnings of $1.18 per share, surpassing the Zacks Consensus Estimate of 81 cents. Higher-than-anticipated operating income from both Motorcycles & Related Products as well as Financial Services segments resulted in this outperformance. The bottom line also compares favorably with the earnings of $1.05 per share reported in the year-ago quarter.
The iconic motorcycle manufacturer generated consolidated revenues (including motorcycle sales and financial services revenues) of $1,365 million, up 17% from the year-earlier quarter. Revenues from the Motorcycle & Related Products unit came in at $1,161 million, marginally missing the consensus mark of $1,167 million.
HarleyDavidson, Inc. Price, Consensus and EPS Surprise
Motorcycles and Related Products: Total revenues from the Motorcycle and Related products segment, which constitute bulk of the firm’s overall revenues, jumped 20% on a year-over-year basis to $1,161 million for the reported quarter. This upside primarily resulted from an increase in wholesale shipments, favorable motorcycle unit mix and pricing. Consequently, the segment posted an operating profit of $98 million, higher than the third-quarter 2020 earnings of $47 million. The metric also beat the Zacks Consensus Estimate of $60 million.
For the September-end quarter, revenues from the sale of motorcycles came in at $886 million, increasing 29% year over year. The company shipped 47,900 motorcycles worldwide, 12% higher than the 43,000 units in third-quarter 2020.
During the reported quarter, Harley-Davidson retailed 50,800 motorcycle units globally, down 6% year over year. Its retail motorcycle units sold in North America grew 2% from the year-ago quarter to 33,900. Meanwhile, sales in the EMEA (Europe, Middle East and Africa), Asia Pacific and Latin America declined 16%, 15% and 41%, respectively, from the year-ago period.
Revenues for Parts & Accessories were down 3% from the prior year to $205 million and missed the consensus mark of $225 million. Revenues for General Merchandise — including Motor Clothes apparel and accessories — remained at par with the prior-year quarter’s figure of $49 million but lagged the consensus mark of $55 million.
Financial Services: Revenues for Harley-Davidson Financial Services totaled $205 million, up 2% year on year, but missing the consensus mark of $207 million. Operating income jumped to $107 million from the $91 million recorded in the year-ago period, thanks to lower interest expense. The metric also topped the consensus mark of $78 million.
Financial Position
For the third quarter of 2021, selling, general and administrative expenses flared up to $212.2 million from the $196.9 million witnessed in third-quarter 2020. The firm generated $281.3 million of cash from operating activities during third-quarter 2021. Capital expenditure totaled $23.9 million. The company paid dividends of 15 cents per share in third-quarter 2021.
Harley-Davidson — which shares space with U.S. auto biggies like Tesla (TSLA - Free Report) , General Motors (GM - Free Report) and Ford (F - Free Report) in the same industry — had cash and cash equivalents of $2,061.3 million as of Sep 26, 2021 compared with $3,257.2 million recorded at the end of 2020. The long-term debt decreased to $4,876.3 million from $5,932.9 million recorded as of Dec 31, 2020.
2021 Guidance
For 2021, Harley-Davidson now forecasts its operating income growth for Financial Services within 95-105%, up from the prior view of 75-85%. Capital expenditure for the full year is projected within $135-$150 million, down from the prior forecast of $190-$225 million.
The Zacks Rank #3 (Hold) company reaffirmed its forecast for the motorcycles segment’s revenues, which are expected to grow in the band of 30-35% in the current year. Harley-Davidson has also kept the operating income margin expectation for the segment intact at 6-8%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Harley-Davidson (HOG) Trumps Q3 Earnings Estimates, Raises '21 View
Harley-Davidson, Inc. (HOG - Free Report) reported third-quarter adjusted earnings of $1.18 per share, surpassing the Zacks Consensus Estimate of 81 cents. Higher-than-anticipated operating income from both Motorcycles & Related Products as well as Financial Services segments resulted in this outperformance. The bottom line also compares favorably with the earnings of $1.05 per share reported in the year-ago quarter.
The iconic motorcycle manufacturer generated consolidated revenues (including motorcycle sales and financial services revenues) of $1,365 million, up 17% from the year-earlier quarter. Revenues from the Motorcycle & Related Products unit came in at $1,161 million, marginally missing the consensus mark of $1,167 million.
HarleyDavidson, Inc. Price, Consensus and EPS Surprise
HarleyDavidson, Inc. price-consensus-eps-surprise-chart | HarleyDavidson, Inc. Quote
Segmental Highlights
Motorcycles and Related Products: Total revenues from the Motorcycle and Related products segment, which constitute bulk of the firm’s overall revenues, jumped 20% on a year-over-year basis to $1,161 million for the reported quarter. This upside primarily resulted from an increase in wholesale shipments, favorable motorcycle unit mix and pricing. Consequently, the segment posted an operating profit of $98 million, higher than the third-quarter 2020 earnings of $47 million. The metric also beat the Zacks Consensus Estimate of $60 million.
For the September-end quarter, revenues from the sale of motorcycles came in at $886 million, increasing 29% year over year. The company shipped 47,900 motorcycles worldwide, 12% higher than the 43,000 units in third-quarter 2020.
During the reported quarter, Harley-Davidson retailed 50,800 motorcycle units globally, down 6% year over year. Its retail motorcycle units sold in North America grew 2% from the year-ago quarter to 33,900. Meanwhile, sales in the EMEA (Europe, Middle East and Africa), Asia Pacific and Latin America declined 16%, 15% and 41%, respectively, from the year-ago period.
Revenues for Parts & Accessories were down 3% from the prior year to $205 million and missed the consensus mark of $225 million. Revenues for General Merchandise — including Motor Clothes apparel and accessories — remained at par with the prior-year quarter’s figure of $49 million but lagged the consensus mark of $55 million.
Financial Services: Revenues for Harley-Davidson Financial Services totaled $205 million, up 2% year on year, but missing the consensus mark of $207 million. Operating income jumped to $107 million from the $91 million recorded in the year-ago period, thanks to lower interest expense. The metric also topped the consensus mark of $78 million.
Financial Position
For the third quarter of 2021, selling, general and administrative expenses flared up to $212.2 million from the $196.9 million witnessed in third-quarter 2020. The firm generated $281.3 million of cash from operating activities during third-quarter 2021. Capital expenditure totaled $23.9 million. The company paid dividends of 15 cents per share in third-quarter 2021.
Harley-Davidson — which shares space with U.S. auto biggies like Tesla (TSLA - Free Report) , General Motors (GM - Free Report) and Ford (F - Free Report) in the same industry — had cash and cash equivalents of $2,061.3 million as of Sep 26, 2021 compared with $3,257.2 million recorded at the end of 2020. The long-term debt decreased to $4,876.3 million from $5,932.9 million recorded as of Dec 31, 2020.
2021 Guidance
For 2021, Harley-Davidson now forecasts its operating income growth for Financial Services within 95-105%, up from the prior view of 75-85%. Capital expenditure for the full year is projected within $135-$150 million, down from the prior forecast of $190-$225 million.
The Zacks Rank #3 (Hold) company reaffirmed its forecast for the motorcycles segment’s revenues, which are expected to grow in the band of 30-35% in the current year. Harley-Davidson has also kept the operating income margin expectation for the segment intact at 6-8%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.