Harley-Davidson (HOG) versus Leatt (LEAT) Critical Comparison

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

Dividends

Harley-Davidson pays an annual dividend of $1.48 per share and has a dividend yield of 3.9%. Leatt does not pay a dividend. Harley-Davidson pays out 42.3% of its earnings in the form of a dividend. Harley-Davidson has raised its dividend for 7 consecutive years.



Analyst Recommendations

This is a summary of recent ratings and recommmendations for Harley-Davidson and Leatt, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Harley-Davidson 2 7 4 0 2.15
Leatt 0 0 0 0 N/A

Harley-Davidson currently has a consensus target price of $44.08, suggesting a potential upside of 15.34%. Given Harley-Davidson’s higher probable upside, research analysts clearly believe Harley-Davidson is more favorable than Leatt.

Profitability

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

Net Margins Return on Equity Return on Assets
Harley-Davidson 10.66% 33.57% 6.63%
Leatt 1.31% 3.52% 2.26%

Valuation & Earnings

This table compares Harley-Davidson and Leatt’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Harley-Davidson $4.92 billion 1.30 $521.75 million $3.50 10.92
Leatt $20.14 million 0.39 $230,000.00 N/A N/A

Harley-Davidson has higher revenue and earnings than Leatt.

Risk and Volatility

Harley-Davidson has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500. Comparatively, Leatt has a beta of -0.91, suggesting that its share price is 191% less volatile than the S&P 500.

Insider and Institutional Ownership

85.9% of Harley-Davidson shares are owned by institutional investors. 0.6% of Harley-Davidson shares are owned by insiders. Comparatively, 40.1% of Leatt shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Harley-Davidson beats Leatt on 12 of the 15 factors compared between the two stocks.

Harley-Davidson Company Profile

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.

Leatt Company Profile

Leatt Corporation designs, develops, markets, and distributes personal protective equipment for participants of motor sports and leisure activities worldwide. The company offers Leatt-Brace, an injection molded neck protection system designed to prevent injuries to the cervical spine and neck. It also provides Leatt helmet range for head and brain protection; and Leatt body armor range, including chest protectors, body protectors, back protectors, elbow guards, shoulder braces, knee braces, knee and leg guards, kidney belts, and impact shorts for use in various activities, such as horseback riding, snowboarding, skiing, and other activities. In addition, the company offers Leatt apparel range comprising gloves, riding jackets, jerseys, bicycle shorts and pants, and off road pants, as well as casual clothing and socks; and other products, parts, and accessories, including toolbelt bags, duffel bags, gear bags, helmet bags, and hats and hydration kits. Further, it provides aftermarket support services; and acts as the original equipment manufacturer for neck braces sold by other brands. The company's products are used by riders of motorcycles, bicycles, snowmobiles, and ATVs, as well as racing car drivers. It sells its products to customers through a network of distributors and retailers; and through online store under the Website leatt.com. The company was formerly known as Treadzone, Inc. and changed its name to Leatt Corporation in May 2005. Leatt Corporation was incorporated in 2005 and is headquartered in Durbanville, South Africa.

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