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From Staff Reports
Harley Davidson Inc. stock (NYSE: HOG) has taken a hard spill after announcing it expects earnings to fall this year.
"Our U.S. dealers' retail sales have fallen sharply during August," said Harley Chief Executive Officer Jim Ziemer. "Against the current economic background, we no longer expect worldwide dealer retail sales to increase during the second half of 2007."
The current economic background to which Ziemer referred consists of a credit crunch, an alarming decrease in payrolls, and oil prices close to $80 per barrel.
The motorcycle giant will be reducing its third quarter product shipments by 5,000 to 7,000 bikes.
It expects earnings to fall by approximately 5% from a year ago. It is estimating earnings per share to be between $3.69 and $3.77, a significant drop from $3.93 last year.
Stock shares plummeted $5.00 (9.2%) after the statement was released last Friday. Since then Harley Davidson stock has dropped an additional $1.92 (3.92%). The stock is down more than 30% this year to date.