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Harley-Davidson, Inc. (HOG - Free Report) reported second-quarter 2022 adjusted earnings of $1.46 per share, beating the Zacks Consensus Estimate of $1.21. Higher-than-anticipated revenues from Motorcycles & Related Products and Financial Services segments resulted in this outperformance. The bottom line also rose 10% from $1.33 per share reported in the year-ago quarter.
The motorcycle manufacturer generated consolidated revenues (including motorcycle sales and financial services revenues) of $1,469 million, down 4% from the year-earlier quarter.
Segmental Highlights
Motorcycles and Related Products: Total revenues from the Motorcycle and Related products segment, which constitute the bulk of the firm’s overall revenues, fell 5% on a year-over-year basis and came at $1,266.5 million. The figure also missed the consensus mark of $1,380 million. The operating income from the segment inched up 3% to $191.7 million and surpassed the Zacks Consensus Estimate of $153 million.
In the quarter under review, revenues from the sale of motorcycles came in at $940 million, edging down 9% year over year and lagging behind the consensus mark of $1,055 million. The company’s global shipments came at 48,168 motorcycles, shrinking 15% year over year.
During the reported quarter, Harley-Davidson retailed 50,452 motorcycle units globally, down 23% year over year. Its retail motorcycle units sold in North America declined 28% to 34,910. Meanwhile, sales in the EMEA (Europe, Middle East and Africa) and Latin America decreased 15% and 8%, respectively, while that in the Asia Pacific inched up marginally by 1%.
Revenues for Parts & Accessories were down 4% from a year ago to $215 million and missed the consensus mark of $230 million. Revenues from Apparel went up 39% from the prior-year quarter to $77 million and crossed the consensus mark of $58 million.
Financial Services: Revenues for Harley-Davidson Financial Services totaled $203 million, up 1% year over year and crossed the consensus mark of $202 million. Operating income declined 9% to $86 million but marginally topped the consensus mark of $85 million.
Financial Position
In the second quarter of 2022, selling, general and administrative expenses came down 11% to $195.3 million from $220.4 million in the year-ago quarter. The firm generated $104.9 million of cash from operating activities in the second quarter. The company paid dividends of 15 cents per share in the reported quarter. It repurchased $64 million shares in the quarter.
Harley-Davidson had cash and cash equivalents of $2,194.3 million as of Jun 26, 2022, significantly up from the $1,741.9 million as of Jun 27, 2021. In the same period, the long-term debt increased to $5,204.3 million from $4,745 million recorded as of Jun 27, 2021.
2022 Guidance
For 2022, the company has restated its previous guidance and projections. Harley-Davidson still expects its operating income for Financial Services to decline 20-25%. Capital expenditure for the full-year remains within $190-$220 million.
The company’s expects revenues from the motorcycles segment to grow in the band of 5-10% for the current year. Harley-Davidson has also kept the operating income margin expectation for the segment intact at 11-12%.
Genuine Parts has an expected earnings growth rate of 15.3% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 1.5% upward in the past 30 days.
Genuine Parts’ earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. GPC pulled off a trailing four-quarter earnings surprise of 11.03%, on average. The stock has risen 17% over the past year.
LCI Industries has an expected earnings growth rate of 65.9% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
LCI Industries’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. LCII pulled off a trailing four-quarter earnings surprise of 21.81%, on average. The stock has declined 10.5% in the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 10.1% over the past year.
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Harley-Davidson (HOG) Q2 Earnings Beat, Sales Shrink Y/Y
Harley-Davidson, Inc. (HOG - Free Report) reported second-quarter 2022 adjusted earnings of $1.46 per share, beating the Zacks Consensus Estimate of $1.21. Higher-than-anticipated revenues from Motorcycles & Related Products and Financial Services segments resulted in this outperformance. The bottom line also rose 10% from $1.33 per share reported in the year-ago quarter.
The motorcycle manufacturer generated consolidated revenues (including motorcycle sales and financial services revenues) of $1,469 million, down 4% from the year-earlier quarter.
Segmental Highlights
Motorcycles and Related Products: Total revenues from the Motorcycle and Related products segment, which constitute the bulk of the firm’s overall revenues, fell 5% on a year-over-year basis and came at $1,266.5 million. The figure also missed the consensus mark of $1,380 million. The operating income from the segment inched up 3% to $191.7 million and surpassed the Zacks Consensus Estimate of $153 million.
In the quarter under review, revenues from the sale of motorcycles came in at $940 million, edging down 9% year over year and lagging behind the consensus mark of $1,055 million. The company’s global shipments came at 48,168 motorcycles, shrinking 15% year over year.
During the reported quarter, Harley-Davidson retailed 50,452 motorcycle units globally, down 23% year over year. Its retail motorcycle units sold in North America declined 28% to 34,910. Meanwhile, sales in the EMEA (Europe, Middle East and Africa) and Latin America decreased 15% and 8%, respectively, while that in the Asia Pacific inched up marginally by 1%.
Revenues for Parts & Accessories were down 4% from a year ago to $215 million and missed the consensus mark of $230 million. Revenues from Apparel went up 39% from the prior-year quarter to $77 million and crossed the consensus mark of $58 million.
Financial Services: Revenues for Harley-Davidson Financial Services totaled $203 million, up 1% year over year and crossed the consensus mark of $202 million. Operating income declined 9% to $86 million but marginally topped the consensus mark of $85 million.
Financial Position
In the second quarter of 2022, selling, general and administrative expenses came down 11% to $195.3 million from $220.4 million in the year-ago quarter. The firm generated $104.9 million of cash from operating activities in the second quarter. The company paid dividends of 15 cents per share in the reported quarter. It repurchased $64 million shares in the quarter.
Harley-Davidson had cash and cash equivalents of $2,194.3 million as of Jun 26, 2022, significantly up from the $1,741.9 million as of Jun 27, 2021. In the same period, the long-term debt increased to $5,204.3 million from $4,745 million recorded as of Jun 27, 2021.
2022 Guidance
For 2022, the company has restated its previous guidance and projections. Harley-Davidson still expects its operating income for Financial Services to decline 20-25%. Capital expenditure for the full-year remains within $190-$220 million.
The company’s expects revenues from the motorcycles segment to grow in the band of 5-10% for the current year. Harley-Davidson has also kept the operating income margin expectation for the segment intact at 11-12%.
Zacks Rank & Key Picks
HOG carries a Zacks Rank #3 (Hold), currently.
Better-ranked players in the auto space include Genuine Parts Company (GPC - Free Report) , LCI Industries (LCII - Free Report) and Standard Motor Products (SMP - Free Report) , each carrying a Zacks Rank #2 (Buy), currently. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Genuine Parts has an expected earnings growth rate of 15.3% for the current year. The Zacks Consensus Estimate for current-year earnings has been revised 1.5% upward in the past 30 days.
Genuine Parts’ earnings beat the Zacks Consensus Estimate in all of the trailing four quarters. GPC pulled off a trailing four-quarter earnings surprise of 11.03%, on average. The stock has risen 17% over the past year.
LCI Industries has an expected earnings growth rate of 65.9% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
LCI Industries’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one. LCII pulled off a trailing four-quarter earnings surprise of 21.81%, on average. The stock has declined 10.5% in the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 10.1% over the past year.