NEW YORK (AP) -- Harley-Davidson Inc. is expected to have another down year in 2010, but there may be signs of recovery as the iconic motorcycle maker continues its restructuring efforts, an analyst said Monday in a research note.
In a survey of 70 dealers, Robert W. Baird & Co. analyst Craig R. Kennison found that the offseason retail market remains soft, with factors such as high unemployment and bad weather to blame.
Dealers were expected to sell between 28,000 and 30,000 bikes in the first quarter, in line with Baird's estimate but down 30 percent from 2009, which was a strong quarter for the bike maker.
For all of 2009, dealers expect sales to drop between five percent and 10 percent, according to the survey.
But Kennison, who rates the shares "Outperform," also wrote that residual values -- the value at the end of lease periods -- should bottom out soon, indicating "the first sign of a recovery." He also said that Harley-Davidson's management team has taken aggressive steps to refocus the company in the face of falling demand for its high end bikes.
The company spent 2009 reorganizing its business, laying off employees, closing factories and discounting or selling unwanted brands.
Company shares were up 26 cents to $24.87 at midday.