Harley-Davidson Revs Up Earnings
05/14/2014 7:00 am EST
As earnings season progresses, we're able to see which stocks have "it"—such as this featured stock, which has been an earnings winner, blasting out of a 14-week base on a great quarterly report, suggests growth stock expert Mike Cintolo, editor of Cabot Top Ten Trader.
Harley-Davidson (HOG) was slammed during the market crash of 2008, but the iconic American motorcycle maker has come roaring back as loud as its signature Hogs.
Driven by a combination of improved operations, production synergies, cost cutting measures, and a push toward international sales, Harley has ridden to four consecutive quarters of double-digit revenue growth.
Harley recently announced that Q2 sales rose 10% year-over-year, blowing past Wall Street expectations. Driving growth was a more than 20% rise in Asia-Pacific sales, while European, Middle Eastern, and African sales combined for an 8% rise, and Latin America sales jumped 9%.
These impressive international figures offset domestic sales growth of just 3%. The company reiterated its 2014 sales guidance, noting strong demand for its Project Rushmore motorcycles. Harley also said it has started shipping the much anticipated Harley-Davidson Street 750 and 500 models.
Overall, Harley had the top two selling motorcycles in the US in 2013, the Harley-Davidson Street Glide Special and the Custom Cruiser Harley-Davidson Breakout.
With the company continuing to release innovative new models, and its Surge Production plan's goal of improving product mix and on-time delivery, Harley-Davidson should continue to see solid growth. HOG has seen choppy trading amid the recent market turmoil.
Shares hit a snag at $70 at the turn of 2014, sending HOG down for a test of $60 and its 200-day moving average. HOG battled back throughout the first quarter, but was limited by resistance. The recent blowout earnings provided the pop HOG needed to eclipse the $70 level.
Shares are still seeing strong post-earnings volume, with pullbacks toward $70 offering opportunities to take bites.
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