This is Why Harley-Davidson (HOG) Stock is Falling After Earnings

On Tuesday, shares of American motorcycle manufacturer Harley-Davidson HOG are falling, down about 4% in morning trading after the company reported first-quarter fiscal 2017 financial results.

Diluted earnings of $ 1.05 per share beat the Zacks Consensus Estimate of 99 cents per share, decreasing 22.8% year-over-year. Total revenues of $ 1.3 billion matched our consensus estimate but fell 15.7% year-over-year. Domestic sales dropped 5.7% in Q1, reflecting weak demand for motorcycles across the industry, while sales in its largest international segments decreased year-over-year as well.

Sales in Europe, the Middle East, and Africa fell 0.4%, and its Asia Pacific region reported a 9.3% decline; revenues in Harley-Davidson’s Latin American segment jumped 24.2% year-over-year.

What’s really hurting the Milwaukee-based motorcycle dealer, however, is its struggle to gain new customers domestically and abroad. In Q1, motorcycle shipments fell 14.7 percent to 70,831, and Harley-Davidson is only forecasting motorcycle shipments of 80,000 to 85,000 for the current quarter, below the FactSet consensus of 86,160.

Demand for Harley-Davidson’s motorcycles continues to slowdown as its core baby boomer customer base grows older, in addition to intense competition from Indian brand bike maker Polaris Industries and Japan’s Honda Motor Co. HMC.

HOG is currently a #3 (Hold) on the Zacks Rank, and has gained almost 28% over the past one year.

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Craig Ballantyne

I love anything to do with Harley Davidson and have two beautiful children and a beautiful partner. In my spare time i like building websites and love anything to do with the internet.

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