Group 1 - Harley-Davidson, Inc. will release its fourth quarter and year-end 2025 financial results on February 10, 2026, before market hours [1] - An audio webcast will be held from 8-9 a.m. CST, where senior management will discuss financial results, business developments, and the company's outlook [1] - A slide presentation supporting the discussion will be available prior to the audio webcast [1] Group 2 - Participants are encouraged to log-on and register at least 10 minutes before the start time [2] - A replay of the audio webcast will be available approximately two hours after the call concludes [2] Group 3 - Harley-Davidson, Inc. is the parent company of Harley-Davidson Motor Company and Harley-Davidson Financial Services [3]

Core Viewpoint - Harley-Davidson is facing challenges due to muted demand trends and tariff pressures, prompting a strategic shift towards more affordable motorcycle models aimed at younger consumers [2][3][5]. Group 1: Demand Trends and Market Outlook - Morgan Stanley has cut its price target for Harley-Davidson from $21 to $18, maintaining an Underweight rating, citing muted demand trends in gaming, lodging, and leisure for 2025 [2]. - The firm anticipates that the demand landscape will remain fundamentally unchanged into 2026, although interest rate dynamics may influence consumer spending patterns [2]. Group 2: Strategic Shifts - In response to cooling demand, Harley-Davidson plans to tighten inventory levels and focus on more affordable motorcycles, moving away from its traditional reliance on higher-income customers and high-margin custom cruisers [3]. - The company is set to launch a new "Sprint" model in 2026, with a starting price below $6,000, targeting younger buyers who seek a fun yet serious riding experience [4]. Group 3: Tariff Impact - Harley-Davidson reported a $27 million tariff charge for the quarter, an increase from $13 million in the previous quarter, as it navigates the impact of U.S. tariffs on critical imports [5]. - The company has narrowed its expected annual tariff impact to a range of $55 million to $75 million, down from an earlier estimate of $50 million to $85 million, indicating ongoing challenges in retail demand [5].

Core Insights - Harley-Davidson (HOG) is focusing on high-potential markets in North America, Europe, and select Asia-Pacific regions while facing challenges from rising tariffs, cost inflation, and poor operating leverage [1] Financial Strategies - Long-term strategic partnerships with KKR and PIMCO are expected to enhance Harley-Davidson Financial Services (HDFS) and improve capital structure, with projected discretionary cash of $1.2-$1.25 billion to be unlocked by Q1 2026 [2] - The significant cash inflow could be utilized for debt reduction (targeting $450 million), accelerating buybacks ($200 million ASR under a $1 billion repurchase program through 2026), or funding targeted product and dealer initiatives [3] Operational Efficiency - The revamped operating model and streamlined organizational structure have improved efficiency across all functions, with a focus on high-potential regions after exiting unprofitable markets [4] - The company aims to strengthen market position while driving productivity and reducing supply-chain costs, emphasizing sportier bikes and modern marketing techniques [5] - Cost regulation is a key component of the multi-year productivity cost program, aiming for $400 million in improvements by 2025, with $257 million in unlevered productivity savings realized from 2022 to 2024 [6] Debt Management - As of September 30, 2025, Harley-Davidson's long-term debt was $3.1 billion, down from $4.5 billion at the end of 2024, with a long-term debt-to-capital ratio of approximately 0.46, providing greater financial flexibility [7] Market Challenges - Tariffs are compressing gross margins, with HDMC's gross margin declining to 26.4% in Q3 from 30.1% the previous year, costing $27 million in the quarter and projected to reach $55-$75 million for full-year 2025 [8] - Unfavorable operating leverage and cost inflation pressures are expected to continue affecting profitability, leading to withheld 2025 guidance due to tariff and trade-policy uncertainty [9] Inventory Issues - Global dealer motorcycle inventories are down 13% year-over-year, with concerns primarily in Touring and CVO inventories, prompting targeted promotions to move stock [11]

Group 1: Market Overview - The consumer discretionary sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] - An asset is considered oversold when the Relative Strength Index (RSI) is below 30, which helps traders gauge short-term performance [1] Group 2: Company Highlights - Best Buy Co Inc (NYSE:BBY) reported better-than-expected third-quarter results with a 2.7% growth in comparable sales, despite a stock decline of around 12% over the past month and an RSI of 24.4 [6][3] - Harley-Davidson announced new executive appointments aimed at enhancing engagement with riders and dealers, with a stock decline of approximately 14% over the past month and an RSI of 27.9 [6][4] - Advance Auto Parts Inc (NYSE:AAP) saw a significant stock drop of about 25% in the last month, with an RSI of 29.2, following a price target reduction by an analyst [6][5]

Core Insights - The consumer discretionary sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] Company Summaries - **Best Buy Co Inc (NYSE:BBY)**: Reported better-than-expected Q3 financial results with a 2.7% growth in comparable sales. The stock has fallen approximately 12% in the past month, with a 52-week low of $54.99. Current RSI value is 24.4, and shares closed at $67.84, down 2.5% [6][3] - **Harley-Davidson**: Recently appointed new executives to enhance operations and engagement with customers. The stock has decreased around 14% over the past month, reaching a 52-week low of $20.45. Current RSI value is 27.9, and shares closed at $20.82, down 0.9% [6][4] - **Advance Auto Parts Inc (NYSE:AAP)**: Analyst Greg Melich maintained an In-Line rating but lowered the price target from $58 to $56. The stock has dropped about 25% in the last month, with a 52-week low of $28.89. Current RSI value is 29.2, and shares closed at $39.87, down 3.4% [6][5]

Core Thesis - Harley-Davidson, Inc. is viewed as a deep-value investment opportunity, trading below tangible book value, indicating that the market assigns little value to its strong brand presence in the motorcycle industry [2][3]. Company Overview - Founded in 1903, Harley-Davidson is a key player in American motorcycling culture, known for its strong brand loyalty [3]. - The company's stock is currently trading at $21.25, with trailing and forward P/E ratios of 5.09 and 6.76 respectively [1]. Valuation Insights - The current market valuation suggests that Harley-Davidson's intangible assets, including its brand and financing arm, are being valued at nearly zero, reflecting investor pessimism rather than the company's intrinsic worth [3]. - A sum-of-the-parts analysis indicates that the intrinsic value of Harley-Davidson could approach the low-$30s per share, suggesting a potential upside of over 50% [7]. Challenges Faced - The company's valuation discount is attributed to both self-inflicted challenges, such as past management decisions and a shift in focus towards younger demographics, and external macroeconomic pressures like high interest rates and weak consumer sentiment [4][5]. - Recent leadership changes are aimed at refocusing on core operations and profitability, which may help address these challenges [5]. Strategic Moves - Harley-Davidson's decision to sell a 10% stake in Harley-Davidson Financial Services (HDFS) has raised investor concerns, but this move is seen as a way to de-risk the business while maintaining operational control [6]. - The transaction, which transfers $4 billion of loans off the balance sheet, is expected to bring in institutional investors like KKR and PIMCO, validating the value of HDFS [6].

Imagine at Harley-Davidson it must have been uh unique to have a woman as CFO, right. >> I've had the good fortune in all of the stops I've had along the way where my bosses have prioritized that diversity of of of thought. >> Noticed also that a lot of [music] people who work here seem to also play the games.You know, they live in this culture. And I must that must have been the same at Harley, right. >> At Harley, you're right.I wasn't a rider, but I'm from [music] Milwaukee. Uh, I learned how to ride. An ...

Group 1 - Harley-Davidson (HOG) shares have underperformed over the past year, losing approximately one-third of their value [1] - Despite the overall market reaching record highs, Harley-Davidson shares are currently near a 52-week low, which was observed during the peak of tariff concerns [1]

Core Insights - The motorcycle maker is enhancing the responsibilities of its finance chief and reintroducing a company veteran as chief operating officer, solidifying the leadership team under new CEO Artie Starrs [1] Group 1 - The company is expanding the role of its finance chief, indicating a strategic shift in financial management [1] - A veteran from within the company is being brought back to take on the role of chief operating officer, suggesting a focus on experienced leadership [1] - These changes are part of a broader effort to strengthen the top ranks of the company under the new leadership of CEO Artie Starrs [1]

Core Insights - Harley-Davidson announced leadership and organizational changes aimed at strengthening its connection with riders and dealers, enhancing operational capabilities, and reaffirming its commitment to Milwaukee as its business hub [1][9]. Leadership Changes - Jonathan Root has been appointed as Chief Financial and Commercial Officer, focusing on dealer relations and integration with Harley-Davidson Financial Services [3][10]. - Bryan Niketh will return as Chief Operating Officer, overseeing Product Management, Product Development, and Product Operations, bringing extensive experience back to the company [4][10]. - Matt Ryan has been named Chief Marketing and Technology Officer, tasked with unifying marketing, digital, and technology efforts to enhance data-driven marketing and customer engagement [5][10]. - Marcus Fischer has taken on the role of Chief Brand Officer, responsible for brand strategy and creative direction, reporting to Matt Ryan [6][10]. - Bill Davidson will serve as Special Advisor to the CEO and Brand Ambassador, focusing on product development and community engagement [7]. - Karen Davidson continues as Brand Ambassador, enhancing collaboration with marketing and brand teams [8]. Commitment to Milwaukee - The company reaffirmed its dedication to Milwaukee, particularly the historic Juneau Avenue campus, as the core of its operations [9]. - These organizational changes are part of a broader strategy to strengthen relationships with dealers and riders, positioning Harley-Davidson for future growth [9]. Company Background - Harley-Davidson, Inc. encompasses Harley-Davidson Motor Company and Harley-Davidson Financial Services, with a mission to lead the motorcycle industry through innovation and a commitment to adventure [11]. - The company aims to maintain its status as the most desirable motorcycle brand globally, offering customizable motorcycles, accessories, and experiences [11]. - Harley-Davidson also holds a controlling interest in LiveWire Group, Inc., focusing on electric motorcycles and urban adventure [11].