According to recent analyst opinion, Harley-Davidson (NYSE: HOG) is a business you should be wary of buying right now. This item reports on a reduction in the price target for the maker of the iconic motorcycle. Edward Aaron over at RBC Capital Markets thinks that earnings and demand won't be great for the company; he slashed his belief of what the shares are worth by $2 to $16 per share.
Harley-Davidson has certainly recovered from its 52-week low made back in March of this year. The stock bounced back from $7.99 to a price of $16.55 as of this writing.
However, the share price was even higher in the beginning of May. It was over $22. After that, the stock lost momentum and started to trend in the downward direction.
Harley-Davidson has been weak the last couple months, but it's up over 2% in afternoon trading as I put this piece together. Apparently, the market doesn't really care about this particular analyst's opinion.
I personally don't find Harley-Davidson attractive. I think the run-up experienced by the stock earlier in the year was merely a reflection of the market's overall euphoria at the time. Everything seemed to be going up. It seems natural that shares of Harley-Davidson would want to take a breather. Plus, you've got to take into account the state of the economy. Yep, the bad economy is still with us, my investing friends. Even though there's been a lot of discussion about a coming recovery, we must remember that everything is debatable on that count.
If you've been waiting to get in this stock, I'd try to be patient for more of a pullback. I tend to agree with the analyst's overall idea that the shares are pretty close to a fair valuation. As such, they're probably risky at this point. And if you've got a good profit in Harley-Davidson now, you many want to consider booking some of the gains.
Disclosure: I don't own any company mentioned; positions can change without notice.
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