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Non-Tech : Harley Davidson (HDI)

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To: Ed Newman who wrote (3)8/29/1996 11:36:00 PM
From: Jackie Goodson   of 156
 
EPS estimates by S&P are 1996=$2.00, 1997=$2.40. MG presents a composite of estimates of 1996=$1.85 and 1997=$2.17. The first half of 1996 EPS were up 28% on 17% higher sales. Stock selling about 2X sales. Predicted annualized 5-year EPS growth rate per MG = 17.1% (composite).
Five year PE range is 38.3 - 23.3. If you use MG's lower 1997 EPS estimate of 2.17 and use the lowest historical PE for the stock of 23.3 you would get a price of $50.50 for year end 1997. Using S&P's 1997 estimate of $2.40 with the lowest PE of 23.3 you get a 1997 price of 55.92.
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