Monday, April 28, 2008

Harley Davidson Increases Dividend 10%

Harley Davidson (HOG) announced a 10% increase in its quarterly cash dividend to 33 cents per share versus 30 cents in the same quarter last year. In spite of this double digit increase, the company is seeing softness in the number of motorcycle units sold. In an announcement earlier this month, HOG stated it would close plants and layoff employees. The goal is to reduce motorcycle shipments by at least 23,000 units.

The estimated 2008 payout ratio is 43% based on 2008 estimated earnings of $3.07. This earnings estimate is down 20% from 2007 earnings of $3.75. The 5-year average payout ratio is 18%. The company carries an S&P Quality Ranking of A+. According to MarketWatch though, Standard and Poor's may downgrade HOG's "A" credit rating due to softer demand for the company's bikes.

(click on table/chart for larger image)

Harley Davidson dividend analysis table April 28, 2008
Harley Davidson stock chart April 28, 2008

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