Here are the most read posts for the last 30 days…
2- Barron’s Piece on Cramer: Be Wary of Those Defending Him
3- Marlboro Smokeless on Sale in October
Categories
Tag: davidson
1. Why You Can’t Ignore the Value in HOG
(via www.collegeanalysts.com)
2. Mauboussin on Strategy: Was Harry Potter Inevitable?
(via www.leggmason.com)
3. Harley Davidson: “Below MSRP” Was A Bad Harbinger
(via valueplays.blogspot.com)
5. ContrarianEdge.com : Anti-Social Investing
(via contrarianedge.com)
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This Weeks Dividend Hikes of Note
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Friday’s 52 Week Low List
Ethanol makers are showing up now…
WOS Wolseley Plc 18.66
VSE Verasun Energy Corp 11.92
PEIX Pacific Ethanol Inc 10.77
PAGI Pemco Aviation Inc 5.50
SIG Signet Group Plc 17.37
SHOO Steven Madden Ltd 18.76
NLS Nautilus Inc 8.28
HOG Harley-Davidson, Inc 46.50
FUN Cedar Fair, L.P. 23.84
CLDN Celadon Group Inc 13.73
BRN Barnwell Industries, Inc 14.95
BOW Bowater Incorporated 14.70
AVR Aventine Renewable Energy 12.10
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Thursday’s 52 Week lows
WMAR West Marine Inc 11.35
WCC Wesco Intl Inc 41.75
SEH Spartech Corporation 17.51
SEED Origin Agritech Limited 6.76
RYL The Ryland Group, Inc 24.31
RT Ruby Tuesday, Inc. (G … 20.44
NT Nortel Networks Corp New 16.45
LCRY LeCroy Corporation 7.10
LANC Lancaster Colony Corp … 36.59
LAB Labranche & Co Inc 4.62
KKD Krispy Kreme Doughnut … 3.10
HOG Harley-Davidson, Inc 46.77
DF Dean Foods Co New 25.32
ALU Alcatel-Lucent 9.16
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Monday’s 52 Week Lows
Here is the list, again assume homebuilders…
WOS Wolseley Plc 19.13
WGO Winnebago Industries, Inc 24.45
UNFI United Natural Foods Inc 24.82
TUES Tuesday Morning Corp 9.87
TLB The Talbots, Inc 18.54
THRD TF Financial Corp 25.82
RT Ruby Tuesday, Inc. 20.82
QSII Quality Systems Inc 33.89
PSS Collective Brands Inc 21.24
PPS Post Properties, Inc 37.20
POOL Pool Corporation 29.85
OPLK Oplink Communications Inc 12.59
ODSY Odyssey Healthcare Inc 9.41
ODP Office Depot, Inc 18.84
OCR Omnicare, Inc 30.07
HOG Harley-Davidson, Inc 48.01
INSP Infospace Inc 12.92
IMN Imation Corp 27.10
FFDF FFD Financial Corporation 14.00
FBN Furniture Brands Inte 10.56
DDS Dillard Department St … 19.91
CWTR Coldwater Creek Inc 11.15
BC Brunswick Corporation 22.57
AVR Aventine Renewable Energy 12.87
Categories
Monday’s Upgrades / Downgrades
UPGRADES
Harley-Davidson HOG Soleil Sell » Buy
RADVision RVSN Ferris Baker Watts Neutral » Buy
Northwest Airlines NWA Calyon Securities Add » Buy
U.S. Steel X Citigroup Hold » Buy
Fifth Third FITB Bernstein Underperform » Mkt Perform
Stone Energy SGY Friedman Billings Mkt Perform » Outperform
Tempur-Pedic TPX CIBC Wrld Mkts Sector Perform » Sector Outperform
Occidental Petro OXY Deutsche Securities Hold » Buy
DOWNGRADES
American Software AMSWA Davenport Buy » Neutral
Cascade CAE DA Davidson Neutral » Underperform
Techne TECH Leerink Swann Outperform » Mkt Perform
US Airways LCC Calyon Securities Buy » Add
Continental Air CAL Calyon Securities Buy » Add
Alaska Air ALK Calyon Securities Buy » Add CMC Citigroup Hold » Buy
“Coming off a negative U.S. retail sales trend in the
first six months of the year, we ran an effective promotion in July that
increased retail sales and reduced inventories of 2007 model motorcycles.
However, our U.S. dealers’ retail sales have fallen sharply during August.” With that, shares of Harley Davidson (HOG) drop 10% today to below $50 a shares, 23% down this year and 28% below their high last year.
HOG now expects a modest decline in revenue for 2007. Diluted earnings per share (EPS) for the full year 2007 are expected to be down 4 to 6 percent, in the range of $3.69 – $3.77, compared to 2006 EPS of $3.93.
Looking ahead to 2008, they anticipate the U.S. retail motorcycle environment will continue to be challenging. It expects moderate revenue growth, lower operating margins and EPS growth of between 4 and 7 percent. They had previously provided guidance for 2009 as well, but will not be providing that guidance at this time.
I mid August in a post I related a conversation I had with a salesperson at a mega dealership Laconia , NH that essentially foreshadowed the above statement. I finished the post by saying “Earlier this year when shares were at $70 I recommended waiting until they reached the mid $50’s to buy. Based on my weekend visit, they may go lower still. This is a great company that makes a one of a kind product, but, people are not buying it now and that will hurt. I think we may see share prices in the $40’s before the year is out.”
We are at the $49 level today (Friday) and I honestly see no reason to jump at shares now. Much like Starbucks (SBUX), I would like to think HOG management was aware of this trend a while ago and hoped it would not come to fruition, all evidence to the contrary. That being said, there very well may be another shoe to drop in the future.
So, what should we do? Just sit back and wait. If you can get shares of this company in the low 40’s, you have a real steal. Be patient and it just may get there. I will go on record and say that anything around $45 or lower will be an no brainer buy.
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Friday’s 52 Week Lows
Add almost every homebuilder to this list today…
WGO Winnebago Industries, Inc 25.03
URGI United Retail Group Inc 7.86
UNFI United Natural Foods Inc 25.08
TLB The Talbots, Inc 19.41
TCMI Triple Crown Media Inc 6.12
SCVL Shoe Carnival Inc 16.60
RYL The Ryland Group, Inc 26.10
RVI Retail Ventures Inc 10.70
PGR The Progressive Corpo 19.66
OXM Oxford Industries, Inc 34.05
OPMR Optimal Group Inc 5.35
ODP Office Depot, Inc 19.84
MGPI Mgp Ingredients Inc 13.76
LM Legg Mason, Inc 81.53
HOG Harley-Davidson, Inc 49.15
CC Circuit City Stores, 9.80
CBOU Caribou Coffee Inc 6.07
BX Blackstone Group L P 21.37
BRN Barnwell Industries, Inc 16.63
BECN Beacon Roofing Supply Inc 10.82
BC Brunswick Corporation 23.16
BBW Build A Bear Workshop 15.87
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Wednesday’s Notable Links
– Now we can bet on the performance of a 16 yr. old NFL coach
– Who’s investments are beating Warren Buffett this year?
– Speaking of Buffett, here are some notes from his alter ego’s shareholder meeting
– In yet another Buffett induced link, here is the transcript from the fund that beat Buffett for a number of years
– A different yet accurate take on my hesitation with Harley Davidson (HOG)shares
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Thursday’s 52 Week Lows
More big names made the list today..
WYE Wyeth
WPSC Wheeling Pittsburgh Corp
THC Tenet Healthcare Corp
TYC Tyco
SHRP Sharper Image Corporation
SHOO Steven Madden Ltd
PFE Pfizer Inc
ODP Office Depot, Inc
NWL Newell Rubbermaid Inc
NMX Nymex Holdings Inc
MOT Motorola, Inc
MCO Moodys Corp
M Macys Inc
KSS Kohl’s Corporation
HRB H&R Block, Inc
HOG Harley-Davidson, Inc
HD Home Depot, Inc
FL Foot Locker Inc
CTAS Cintas Corporation
BX Blackstone Group L P
BC Brunswick Corporation
BBY Best Buy Co., Inc
AMGN Amgen Inc
AMD Advanced Micro Devices
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Wednesday’s 52 Week Lows
Dow down 5% in 5 days……some big names are making the list now
WMT Wal-Mart Stores, Inc
USG USG Corporation
TE TECO Energy, Inc
SKX Skechers U S A Inc
SCT Scottish Re Group Limited
SCSS Select Comfort Corp
RAIL Freightcar Amer Inc
NWL Newell Rubbermaid Inc
NVS Novartis A G
MAS Masco Corporation
M Macys Inc
LIZ Liz Claiborne, Inc
LEH Lehman Brothers Holdings
HOG Harley-Davidson, Inc
FL Foot Locker Inc
DAL Delta Air Lines Inc Del
CHS Chico’s FAS Inc
CFC Countrywide Financial
BOW Bowater Incorporated
AMD Advanced Micro Devices
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Wednesday’s Upgrades and Downgrades
Here are the calls
UPGRADES
Fossil FOSL Piper Jaffray Market Perform » Outperform
Methanex MEOH CIBC Wrld Mkts Sector Underperform » Sector Perform
Wash. Federal WFSL Friedman Billings Mkt Perform » Outperform
Allegheny Tech ATI Davenport Buy » Strong Buy
A.M. Castle CAS Davenport Buy » Strong Buy
Carpenter Tech CRS Davenport Buy » Strong Buy
RF Micro Device RFMD Charter Equity Mkt Perform » Buy
Domtar UFS DA Davidson Neutral » Buy
Insituform Tech INSU Morgan Joseph Sell » Hold
OmniVision OVTI Pacific Growth Equities Neutral » Buy
Lexmark LXK FTN Midwest Sell » Neutral
Leap Wireless LEAP Stanford Research Hold » Buy
DOWNGRADES
Northstar Realty NRF Lehman Brothers Overweight » Equal-weight
Newcastle Investment NCT Lehman Brothers Overweight » Equal-weight
KKR Financial KFN Lehman Brothers Overweight » Equal-weight
Arbor Realty Trust ABR Lehman Brothers Overweight » Equal-weight
Thornburg Mortg TMA Citigroup Hold » Sell
UBS AG UBS Credit Suisse Outperform » Neutral
Daktronics DAKT Janco Partners Accumulate » Mkt Perform
Pope & Talbot POP DA Davidson Neutral » Underperform
Sirenza Micro SMDI Morgan Keegan Outperform » Mkt Perform
Haverty Furniture HVT Morgan Keegan Outperform » Mkt Perform
Thornburg Mortg TMA Piper Jaffray Market Perform » Underperform
Thornburg Mortg TMA Jefferies & Co Hold » Underperform
Avery Dennison AVY Matrix Research Hold » Sell
Categories
Harley Davidson: "Below MSRP"
We took a quick vacation this past weekend and brought the kids to Storyland in Glenn, NH. If you’ve never done it and have pre-teen kids, do it, it is a wonderful place.
Anyway, on the way back home we stopped in Meredith, NH to have lunch at Hart’s Turkey Farm (another great place). Now, for those of you not familiar with the NH geography, Meredith is right next to Laconia, which is essentially the center of the Harley universe in New England. Laconia is famous for two things, “Bike Week” and well, “Bike Week”. My sons and I sauntered over to the massive Harley Davidson (HOG) dealership for a stroll and to look at all the bikes. One thing immediately struck me. Evey single bike in the store, almost 100 had the same tag on it “Priced Below MSRP”.
I casually asked a salesperson, “What is going on, why is everything on sale”? He replied “can’t move ’em and the new models are coming out”. HMMMM
When I asked why he though they were not selling he replied that most people had been upgrading the last few years with two things, house money (home equity) or Harley financing which is now getting harder to get and much more expensive. He said that because of this people are either sticking with the bikes they have much longer and those who are buying, are buying cheaper, lower margin bikes. For instance, a bike that was selling for $10,000 last year was being offered below $8,000 yesterday. Both of these are very bad for Harley.
When I asked what would happen if he can’t move the old models when the new ones come out, he said that they will just cut back the new model orders. Even worse for Harley.
Earlier this year when shares were at $70 I recommended waiting until they reached the mid $50’s to buy. Based on my weekend visit, they may go lower still. This is a great company that makes a one of a kind product, but, people are not buying it now and that will hurt. I think we may see share prices in the $40’s before the year is out.
Be patient and you may get a fantastic buy, later…
Categories
Upgrades / Downgrades
Here are the late Monday and early Tuesday calls
UPGRADES
Cooper Tire CTB BB&T Capital Mkts Hold » Buy
Silicon Image SIMG Jefferies & Co Underperform » Hold
Alliant Energy LNT Robert W. Baird Neutral » Outperform
Advanced Semi ASX Citigroup Hold » Buy
Burger King BKC Citigroup Hold » Buy
Pepsi Bottling PBG Banc of America Sec Neutral » Buy
Buffalo Wild Wings BWLD Merriman Curhan Ford Neutral » Buy
Electronic Arts ERTS Davenport Reduce/Sell » Neutral
ACCO Brands ABD Barrington Research Mkt Perform » Outperform
Fuel-Tech FTEK Roth Capital Hold » Buy
Marvel Enterprises MVL Janco Partners Mkt Perform » Accumulate
Walter Inds WLT Davenport Buy » Strong Buy
Fiserv FISV DA Davidson Neutral » Buy
Captaris CAPA B. Riley & Co Neutral » Buy
Comerica CMA AG Edwards Hold » Buy
National Cinemedia NCMI Janco Partners Mkt Perform » Accumulate
Tesco TESO CapitalOne southcoast Hold » Buy
TheStreet.com TSCM Needham & Co Buy » Strong Buy
DOWNGRADES
Luminent Mortgage Capital LUM Keefe Bruyette Outperform » Mkt Perform
Itron ITRI JP Morgan Overweight » Neutral
Luminent Mortgage Capital LUM JMP Securities Mkt Outperform » Mkt Underperform
j2 Global JCOM Jefferies & Co Buy » Hold
Thornburg Mortg TMA Deutsche Securities Hold » Sell
Opteum OPX Deutsche Securities Buy » Hold
F5 Networks FFIV Ferris Baker Watts Buy » Neutral
CheckFree CKFR DA Davidson Buy » Neutral
XTO Energy XTO Oppenheimer Buy » Neutral
Exxon Mobil XOM Oppenheimer Buy » Neutral
Valero Energy VLO Oppenheimer Buy » Neutral
Tesoro Petroleum TSO Oppenheimer Buy » Neutral
Sunoco SUN Oppenheimer Buy » Neutral
Pioneer Natural PXD Oppenheimer Buy » Neutral
Occidental Petro OXY Oppenheimer Buy » Neutral
Noble Energy NBL Oppenheimer Buy » Neutral
Murphy Oil MUR Oppenheimer Buy » Neutral
Marathon Oil MRO Oppenheimer Buy » Neutral
Hess HES Oppenheimer Buy » Neutral
Frontier Oil FTO Oppenheimer Buy » Neutral
EOG Resources EOG Oppenheimer Buy » Neutral
Devon Energy DVN Oppenheimer Buy » Neutral
Chevron CVX Oppenheimer Buy » Neutral
Comstock CRK Oppenheimer Buy » Neutral
ConocoPhillips COP Oppenheimer Buy » Neutral
Cabot Oil & Gas COG Oppenheimer Buy » Neutra