Harley-Davidson has struggled for years. Citi just told clients to buy it anyway. This is what passes for analysis when you charge a two percent management fee.
The stock trades like a cigarette company that forgot to be addictive. Revenue peaked in 2014. The customer base ages out faster than the warranty expires. But some guy with a Bloomberg terminal ran a regression and decided now's the time.
Citi says the company is gaining momentum. Momentum toward what? The core demographic is men over fifty who want to feel dangerous while wearing a helmet required by law. That's not a growth market. That's a support group with chrome accessories.
The analyst probably looked at a chart. Saw some lines cross. Typed "buy" into a template. Sent it to clients who will ignore it because they already own Tesla and three leveraged ETFs they can't pronounce.
Harley's strategy is to appeal to younger riders. Younger riders want electric bikes that don't sound like a divorce announcement. They want something that starts without a prayer and a choke lever. They want to arrive at brunch without their lower back filing a grievance.
But sure. Buy the stock because Citi said so. The same Citi that needed a bailout. The same Citi that thought subprime mortgages were a diversification play. The same Citi that has been wrong about everything except the location of its own headquarters.
Retail traders will see this headline and think they found the next turnaround story. They'll buy twelve shares at market open. They'll watch it drift sideways for six months. They'll sell at a loss to buy whatever Jim Cramer yells about next.
Harley-Davidson makes a fine motorcycle if you enjoy explaining to your cardiologist why you need something louder than his advice.
Photo by Donald Teel on Unsplash
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