Harley-Davidson (HOG) Stock Price Target Upped at BMO Capital

Harley-Davidson (HOG) stock price target was raised to $54 from $50 at BMO Capital after speculation that KKR (KKR) may have interest in acquiring the company.
By Kaya Yurieff ,

NEW YORK (TheStreet) -- Harley-Davidson (HOG) - Get Report stock price target was increased to $54 from $50 at BMO Capital Markets. The firm has a "market perform" rating on shares.

The higher price target comes after the stock rallied about 20% on Friday after reports that private equity firm KKR (KKR) may be interested in offering $65 per share to acquire the company.

"We have no particular insights into the veracity of these reports, but given the company's strong balance sheet, solid cash flow, superior brand name, and encouraging new product strategies, we think a leverage buyout could work," BMO wrote in an analyst note.

A $65 per share deal would appear to be sustainable, with cash flow better than potential interest expense, the firm added.

"Given an inexpensive valuation, if the acquirer could improve business performance, such a deal could provide value over time, in our opinion," BMO noted.

Shares of Harley-Davidson are retreating 3.83% to $52.17 in pre-market trading on Tuesday.

Separately,  TheStreet Ratings Team has a "Hold" rating with a score of C+ on the stock.

The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and growth in earnings per share.

However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and weak operating cash flow.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: HOG

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