Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, motorcycle specialist Harley-Davidson
With that in mind, let's take a closer look at Harley's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||Milwaukee (1903)|
|Market Cap||$9.19 billion|
|Trailing-12-Month Revenue||$5.21 billion|
CEO Keith Wandell (since 2009)
CFO John Olin (since 2009)
|Return on Equity (Average, Past 3 Years)||13.1%|
|Cash/Debt||$1.61 billion / $5.57 billion|
Sources: S&P Capital IQ and Motley Fool CAPS.
About a month ago, nckballard touched on Harley's seemingly unsustainable valuation: "The overall economy will see slow growth over the next several years at least. With slow growth in consumer demand for large discretionary purchases and increased competition, there is no justification for such a high P/E ratio."
Harley even sports an EV/EBITDA ratio of 12.3. That represents a premium to rivals Honda (10.7) and Polaris (10.1), as well as other recreational vehicle stocks like Winnebago Industries
CAPS member SwanGreenSwan elaborates on the bear case:
Harley is: 1) losing market share in the USA, a sign that consumer tastes have begun to shift to quieter, less expensive and more fuel efficient toys which suggests its pricing power is waning ... 3) EPS estimates appear vulnerable to reductions. 4) its financial services arm has a poor credit underwriting history ... 6) its premium multiple is likely to evaporate on the above factors. Dangerous curves ahead of estimate and multiple reduction. Remember there is rarely just one cockroach.
What do you think about Harley, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!
Interested in another easy way to track Harley? Add it to your watchlist.
More from The Motley Fool
Harley-Davidson Stock Upgraded: What You Need to Know
Wells Fargo says all's well with Harley's valuation today.
Why Shares of Harley-Davidson, Inc. Plunged 10.3% in 2017
The classic motorcycle brand may be losing its luster.
Is This Harley-Davidson's New Urban-Themed Motorcycle?
The bike maker has filed for an intriguing trademark, though what it's for is anybody's guess.