Jul. 30 at 6:09 PM
$KKR $HOG Despite falling motorcycle sales, Harley-Davidson surged 16%—its best day in 5 years—after Harley-Davidson announced a deal with KKR and Pimco. The company is selling a 4.9% stake in HOG Financial Services and $ 5B in retail loans, unlocking
$1.25B in cash. CEO Jochen Zeitz said $ 450M will go to debt reduction, and $ 500M to accelerate buybacks in H2 2025—about 15.5% of Harley’s
$3.2B market cap.
The deal is expected to more than double 2025 HDFS income to $ 525M–$ 550M, versus a $ 248M forecast for 2024. Additionally, new tax legislation will allow interest deductions (up to $ 10K/year) on loans for U.S.-made motorcycles—a move Harley believes could boost demand.
Still, Q2 earnings disappointed: net income fell 51% to $ 108M, or
$0.88/share (vs.
$0.96 expected), on a 19% revenue drop to
$1.31B. Motorcycle revenue fell 23% to
$1.04B, missing forecasts due to a 28% drop in shipments. HOG is down 12% YTD vs. SPX +8.6%. LiveWire sales also dropped 65% to just 55 units.
