Harley-Davidson's stock drops on heavy volume after analyst cuts unit sales outlook

Shares of Harley-Davidson Inc. tumbled 7.2% in active morning trade Wednesday, after ITG Investment Research slashed its first-quarter unit sales outlook for the motorcycle maker because of evidence that sales trends weakened considerably in March. Volume was over 4 million shares after the first hour of trade, already nearly double the full-day average. Analyst John Tomlinson cut his U.S. retail unit sales outlook by three percentage points, and he now expects a decline of 7% to 5% from a year ago, compared with consensus expectations of a 0.1% decline. "Despite sequential improvement in February, our research indicates retail trends were weak in March for Harley-Davidson," Tomlinson wrote in a note to clients. "Additionally, after relatively stable market share in the first two months of the quarter, Harley-Davidson appeared to lose market share at an accelerated pace [year-over-year] in March, resulting in an overall market share decline in the first quarter." The stock has now lost 11% since closing at a 5 1/2-month low on Friday. It is still up 1.9% year to date, while the S&P 500 has gained 0.3%.

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