Financial Review: Harley-Davidson (HOG) and Yamaha Motor (YAMHF)

Harley-Davidson (NYSE: HOG) and Yamaha Motor (OTCMKTS:YAMHF) are both auto/tires/trucks companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, risk and institutional ownership.

Volatility & Risk

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Harley-Davidson has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Yamaha Motor has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Profitability

This table compares Harley-Davidson and Yamaha Motor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Harley-Davidson 10.62% 31.23% 5.92%
Yamaha Motor N/A N/A N/A

Dividends

Harley-Davidson pays an annual dividend of $1.48 per share and has a dividend yield of 3.5%. Yamaha Motor does not pay a dividend. Harley-Davidson pays out 42.3% of its earnings in the form of a dividend. Harley-Davidson has increased its dividend for 7 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and target prices for Harley-Davidson and Yamaha Motor, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Harley-Davidson 1 12 6 0 2.26
Yamaha Motor 0 1 0 0 2.00

Harley-Davidson presently has a consensus price target of $50.71, suggesting a potential upside of 20.61%. Given Harley-Davidson’s stronger consensus rating and higher possible upside, equities analysts plainly believe Harley-Davidson is more favorable than Yamaha Motor.

Earnings and Valuation

This table compares Harley-Davidson and Yamaha Motor’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Harley-Davidson $4.92 billion 1.44 $521.75 million $3.50 12.01
Yamaha Motor $14.90 billion 0.73 $930.76 million $2.66 11.68

Yamaha Motor has higher revenue and earnings than Harley-Davidson. Yamaha Motor is trading at a lower price-to-earnings ratio than Harley-Davidson, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

95.9% of Harley-Davidson shares are owned by institutional investors. 0.6% of Harley-Davidson shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Harley-Davidson beats Yamaha Motor on 13 of the 17 factors compared between the two stocks.

About Harley-Davidson

Harley-Davidson, Inc. primarily manufactures and sells cruiser and touring motorcycles. The company operates in two segments, Motorcycles & Related Products, and Financial Services. The Motorcycles & Related Products segment designs, manufactures, and sells at wholesale on-road Harley-Davidson motorcycles, as well as motorcycle parts, accessories, general merchandise, and related services. It offers motorcycle parts and accessories, such as replacement parts, and mechanical and cosmetic accessories; and general merchandise, including MotorClothes apparel and riding gear, as well as licenses the Harley-Davidson name and other trademarks. This segment sells its products to retail customers through a network of independent dealers, as well as e-commerce channels in the United States, Canada, Latin America, Europe, the Middle East, Africa, and the Asia-Pacific. The Financial Services segment provides wholesale financing services, such as floorplan and open account financing of motorcycles, and motorcycle parts and accessories; and retail financing services, including installment lending for the purchase of new and used Harley-Davidson motorcycles, as well as point-of-sale protection products comprising motorcycle insurance, extended service contracts, and motorcycle maintenance protection. This segment also licenses the Harley-Davidson brand to third-party financial institutions. The company was founded in 1903 and is based in Milwaukee, Wisconsin.

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