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Harley-Davidson Goes Whole Hog on Q4 Results
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Harley-Davidson Goes Whole Hog on Q4 Results

Harley-Davidson (HOG) pleased its investors with today’s Q4 earnings report. The motorcycle manufacturer showed 40% revenue growth, year-over-year, driven by strong pricing and unit sales mix. Its GAAP diluted of EPS was $0.14, versus a year-ago loss of $0.63, and its operating income growth, at $18 million, was 24% higher than in the previous year.

The company’s overall 2021 results were also a win. HOG delivered full-year GAAP diluted EPS of $4.19, a rise of $4.18 over the previous year. It also grew the total revenue by 32%, thanks to increased shipments and a favorable motorcycle unit mix.

Additionally, the company reported that it had successfully completed the first year of its Hardwire Five-year Strategic Plan. Among the plan’s targets are increased profitability and low double-digit EPS growth, through 2025.

Another target is to strengthen its commitment to electric by creating a division wholly devoted to becoming a leader in the electric motorcycle market. To that end, the recently announced planned merger transaction for LiveWire with the AEA-Bridges Impact Corporation (IMPX) should promote the company’s strategic plan.

Specifically, the merger will combine Harley-Davidson’s electric motorcycle division, LiveWire, with the AEA-Bridges SPAC. Together, they will form a new company, which will trade on the NYSE with the ticker LVW. The transaction is expected to close in the first half of 2022.

Commenting on the earnings report, Jochen Zeitz, Chairman, President and CEO, Harley-Davidson, said, “Harley-Davidson delivered a strong finish to the year, in which we have seen proof points on all elements of our Hardwire Strategy.”

TipRanks’ Analysis

Analysts are mixed on HOG, with three Buy and two Hold ratings given in the past three months. Average HOG price target is $52.80, implying a 34.7% upside.

According to TipRanks’ Smart Score, Harley-Davidson has a score of nine, indicating that the stock is likely to outperform the market. Bloggers and news articles are bullish on the stock, and hedge funds have increased their holdings of HOG stock by 2.7 million shares in the last quarter.

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