Please ensure Javascript is enabled for purposes of website accessibility

Why Harley-Davidson Stock Fell This Morning

By Rich Duprey – Jun 9, 2020 at 12:14PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

From its early April bottom, the motorcycle maker's stock has risen about halfway back to where it began 2020. But is that renewed optimism warranted?

What happened

Shares of Harley-Davidson (HOG -2.41%) were down 4.8% at noon EDT Tuesday as the market gave up some of the gains it has made over the past week on hopes for a reopened economy.

So what

The iconic motorcycle maker has ridden the market rebound from the depths of the pandemic-induced collapse in March to 85% gains (though it remains down close to 30% on the year), and is likely falling in sympathy with the broader market Tuesday as investors take profits.

Motorcycle riding into the sunset

Image source: Getty Images.

Now what

Although there is some not-unwarranted optimism that Harley-Davidson management may be getting the company back on the right track, it's way too early to suggest sales will recover.

Management said it was revising its roadmap for recovery, and will focus on the U.S. market and its core products again. Under former CEO Matt Levatich's tenure, the bike maker was attempting to pivot the business toward international markets, younger riders, and electric motorcycles.

Yet Harley has yet to offer up any details on exactly what the new plans will do to reverse its five-year slide in sales. Big bikes and an aging core customer demographic were what got Harley in the situation it's in, so doubling down on them could exacerbate its problems.

Investors won't know what Harley's leadership actually intends until it updates them in July, so the enthusiasm that has been exhibited for its stock is a bit premature.

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Harley-Davidson Stock Quote
$36.10 (-2.41%) $0.89

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/06/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.