Harley-Davidson Inc (HOG): Today's Featured Automotive Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Harley-Davidson ( HOG) pushed the Automotive industry lower today making it today's featured Automotive laggard. The industry as a whole closed the day down 1%. By the end of trading, Harley-Davidson fell 61 cents (-1.4%) to $42.43 on light volume. Throughout the day, 1.5 million shares of Harley-Davidson exchanged hands as compared to its average daily volume of 2.4 million shares. The stock ranged in price between $42.16-$43.08 after having opened the day at $42.89 as compared to the previous trading day's close of $43.04. Other companies within the Automotive industry that declined today were: Enova Systems ( ENA), down 9.6%, Navistar International ( NAV), down 7.2%, Stoneridge ( SRI), down 5.6%, and Wabash National Corporation ( WNC), down 3.2%.

Harley-Davidson, Inc. engages in the production and sale of heavyweight motorcycles. It operates in two segments, Motorcycles and Related Products, and Financial Services. Harley-Davidson has a market cap of $9.65 billion and is part of the consumer goods sector. The company has a P/E ratio of 15.2, above the average automotive industry P/E ratio of 13.7 and below the S&P 500 P/E ratio of 17.7. Shares are up 10.7% year to date as of the close of trading on Wednesday. Currently there are 11 analysts that rate Harley-Davidson a buy, no analysts rate it a sell, and four rate it a hold.

TheStreet Ratings rates Harley-Davidson as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth, notable return on equity, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the automotive industry could consider Consumer Discretionary Sel Sec SPDR ( XLY) while those bearish on the automotive industry could consider ProShares Ultra Sht Consumer Goods ( SZK).
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