HOG Stock Risk & Deep Value Analysis
Harley-Davidson Inc
DVR Score
out of 10
What You Need to Know About HOG Stock
We analyzed Harley-Davidson Inc using our deep value framework. Sign in to see our full verdict and DVR Score.
We ran HOG through our deep value framework — analyzing financial health, distress signals, competitive moat, and risk factors. Our risk assessment: Aggressive. Here's what we found.
HOG Risk Analysis & Red Flags
What Could Go Wrong
The 'Back to the Bricks' turnaround plan may fail to deliver on its ambitious targets for EBITDA and dealer profitability, leading to continued revenue declines and severe negative operating cash flow, forcing further cost cuts or dilutive financing for a company already struggling for growth.
Risk Matrix
Overall
Aggressive
Financial
Medium
Market
Medium
Competitive
Medium
Execution
High
Regulatory
Low
Red Flags
- ⚠
Negative operating cash flow of -$228M in Q1 2026 (vs. +$141.5M prior year)
- ⚠
Consolidated operating income down 85% YoY ($23M vs $160.5M)
- ⚠
Declining HDMC gross margin (25.3% from 29.1%)
- ⚠
EPS miss of $0.05 and a 79% YoY decline in Q1 2026
- ⚠
Significant restructuring costs ($15M) and tariff costs ($45M) impacting profitability
Upcoming Risk Events
- 📅
Failure of 'Back to the Bricks' turnaround plan to deliver targets
- 📅
Continued sharp declines in HDMC operating income and consolidated operating cash flow
- 📅
Intensified competition in traditional or electric motorcycle segments
When to Reconsider
- 🚪
Quarterly operating cash flow remains significantly negative for 2+ consecutive quarters
- 🚪
HDMC retail sales turn negative YoY in North America
- 🚪
Management revises 'Back to the Bricks' targets downwards or delays timelines
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Investment Thesis
Harley-Davidson is an iconic brand executing a critical 'Back to the Bricks' turnaround to revitalize its core business and build a presence in the electric vehicle market via LiveWire. Despite severe Q1 2026 profitability declines and negative cash flow, significant debt reduction and ongoing share buybacks demonstrate a commitment to financial health and shareholder value. This is a highly speculative value play banking on successful execution of the turnaround plan and eventual scaling of LiveWire.
Is HOG Stock Undervalued?
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HOG Price Targets & Strategy
12-Month Target
$35.00
Bull Case
$44.00
Bear Case
$20.00
Valuation Basis
Based on a blend of TIKR model target ($44) and modest recovery in core business profitability, aiming for a 0.7x P/S multiple on estimated FY26 revenue of ~$5.3B.
Entry Strategy
Dollar-cost average between $23-$26, eyeing a potential stabilization or early signs of 'Back to the Bricks' traction. Current price ($25.42) is in a reasonable entry zone for speculative turnaround play.
Exit Strategy
Take 50% profit at $35, reassess at $44. Set a stop-loss at $20 if operational metrics continue to deteriorate or turnaround plan fails.
Portfolio Allocation
2% for aggressive risk tolerance.
Price Targets & Strategy
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Is HOG Financially Healthy?
Valuation
P/E Ratio
7.90
Forward P/E
73.60
Price/Book
0.83
Profitability
Gross Margin
31.64%
Operating Margin
8.64%
Net Margin
7.57%
Return on Equity
10.26%
Revenue Growth
-13.76%
EPS
$2.60
Balance Sheet
Current Ratio
2.10
Quick Ratio
1.83
Debt/Equity
0.94
Total Debt
$5.50B
Cash & Equivalents
$1.81B
Cash Flow
Operating Cash Flow
-$228.00M
Free Cash Flow
-$512.30M
Other
Beta (Volatility)
1.31
Dividend Yield
3.17%
Does HOG Have a Competitive Moat?
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🛡️ Narrow
Moat Trend
Eroding
Moat Sources
2 Identified
The iconic Harley-Davidson brand still commands significant loyalty, but its durability is challenged by changing consumer preferences, an aging core demographic, and the slow pace of adoption for its electric initiatives. The brand alone may not be sufficient without significant product innovation and market expansion.
Moat Erosion Risks
- •Accelerated shift away from traditional internal combustion engine (ICE) motorcycles
- •Failure to innovate or capture significant market share in the electric motorcycle segment (LiveWire)
- •Increasing competition from diverse manufacturers offering modern alternatives
HOG Competitive Moat Analysis
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HOG Market Intelligence
Sentiment & Insider Activity
Social Sentiment
Neutral (likely mixed, with long-term brand loyalists versus skeptical growth investors)
Institutional Sentiment
Neutral (TIKR model target positive, but earnings performance raises concerns; Q1 share buybacks are a positive signal)
Insider Activity (Form 4)
Company repurchased 6.6M shares ($128M) in Q1 2026, indicating management's confidence in the company's value.
Options Flow
Normal options activity.
Earnings Intelligence
Next Earnings
Estimated early August 2026
Surprise Probability
Medium
Historical Earnings Pattern
Q1 2026 saw a revenue beat but a significant EPS miss and steep profit decline, which may lead to volatile stock reactions in future reports based on management's commentary and forward guidance.
Key Metrics to Watch
Competitive Position
Top Competitor
Polaris Inc (PII)
Market Share Trend
Gaining ground in Q1 2026 with HDMC global retail sales +8% YoY and North America +14%, potentially stabilizing its core market share after previous declines.
Valuation vs Peers
Trading at a discount to many industrial peers on revenue multiples (P/S ~0.5x), reflecting its turnaround status and profitability challenges.
Competitive Advantages
- •Globally recognized, iconic brand heritage and customer loyalty
- •Extensive global dealer network
- •Unique product identity and cultural significance
Market Intelligence
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What Could Drive HOG Stock Higher?
Near-Term (0-6 months)
- •Q2 2026 Earnings (estimated August 2026) with updates on 'Back to the Bricks'
- •Initial success metrics from 'Back to the Bricks' plan (e.g., dealer profitability improvements)
Medium-Term (6-18 months)
- •Progress towards >$350M HDMC EBITDA target in 2027
- •Significant expansion of LiveWire sales or market reach
Long-Term (18+ months)
- •Successful full implementation of 'Back to the Bricks' by 2029
- •Established market leadership in a niche within the electric motorcycle segment
Catalysts & Growth Drivers
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What's the Bull Case for HOG?
- ✓
Consistent improvement in HDMC operating margins and overall operating income
- ✓
Achieving and sustaining positive operating cash flow
- ✓
Significant revenue growth and scaling of LiveWire segment
Bull Case Analysis
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How Harley-Davidson Inc Makes Money
Harley-Davidson Inc. manufactures and sells a distinct line of heavyweight cruiser and touring motorcycles, along with parts, accessories, and general merchandise, primarily through a global network of independent dealers. The company also provides wholesale and retail financial services (HDFS) to support its dealers and customers. Additionally, Harley-Davidson is venturing into electric motorcycles through its LiveWire segment, aiming to adapt to evolving market trends and attract a new generation of riders.
Read Full Business Model BreakdownFAQ
What is the DVR Score for Harley-Davidson Inc (HOG)?
As of May 10, 2026, Harley-Davidson Inc has a DVR Score of 3.0 out of 10, placing it in the "Risk Trap" category. This score is generated by our AI-powered deep value analysis framework that evaluates growth potential, financial health, competitive moat, and risk factors.
What is the market capitalization of Harley-Davidson Inc?
Harley-Davidson Inc's market capitalization is approximately $2.7B..
What is the risk level for HOG stock?
Our analysis rates Harley-Davidson Inc's overall risk as Aggressive. This assessment considers execution risk, market risk, financial risk, competitive risk, and regulatory risk. For a full breakdown, see the risk analysis section above.
What is the P/E ratio of HOG?
Harley-Davidson Inc currently has a price-to-earnings (P/E) ratio of 7.9. This is below the market average, which could indicate the stock is undervalued or facing headwinds.
Does Harley-Davidson Inc pay a dividend?
Yes, Harley-Davidson Inc pays a dividend with a current yield of approximately 3.17%.
Is Harley-Davidson Inc's revenue growing?
Harley-Davidson Inc has reported revenue growth of -13.8%. Revenue has been declining, which warrants closer examination.
Is HOG stock profitable?
Harley-Davidson Inc has a profit margin of 7.6%. The company is profitable but margins are modest.
How often is the HOG DVR analysis updated?
Our AI-powered analysis of Harley-Davidson Inc is refreshed regularly to incorporate the latest financial data, market conditions, and news. The most recent update was on May 10, 2026.
Important Disclaimer – Not Financial Advice
Deep Value Reports is an independent research platform for educational and informational purposes only. We are not financial advisors, investment advisors, or licensed professionals. The analysis, scores, and information provided on this page for HOG (Harley-Davidson Inc) should not be construed as personalized investment advice, a recommendation to buy or sell any security, or an offer to provide investment advisory services.
All investments involve risk, including the potential loss of principal. Past performance does not guarantee future results. Always conduct your own research, consider your financial situation, and consult with a qualified financial advisor before making any investment decisions.