Harley-Davidson heads into its May 5 Q1 earnings and strategic plan presentation with short sellers beating a rapid retreat — yet options traders loading up on puts, creating one of the more conflicted setups the stock has seen this year.
The short-covering story is the week's standout. Short interest fell nearly 16% in seven days, dropping from roughly 18.6 million shares to 15.7 million. That move dragged the float-adjusted short position from around 17% of free float down to 13.3% — a meaningful reduction in a matter of days. The sharpest single-day drop came between April 22 and April 24, when around 3 million shorted shares disappeared from the register. The 30-day trend is also lower, off 6%. Yet even after the retreat, 13% short interest is far from benign — it still places HOG in a heavily-shorted cohort, and the ORTEX short score of 60.8 sits in roughly the bottom decile by rank. The borrow market, at least, is comfortable: cost to borrow has eased to 0.46% from above 0.55% a month ago, and availability is loose, suggesting no squeeze mechanics are building.
Options positioning tells a starkly different story. The put/call ratio climbed to 1.68 — nearly 1.8 standard deviations above its 20-day average of 1.42 — and is now close to its 52-week high of 1.86. Demand for downside protection has accelerated across the past two weeks, with the PCR moving from around 1.27 in early April to its current elevated level. That divergence is worth naming directly: shorts are covering, but options traders are hedging hard. The two moves are not necessarily contradictory — covering shorts while buying puts could reflect a single tactical view, rotating the short exposure from the borrow market into the options market ahead of a binary event.
The Street is broadly skeptical, though not uniformly so. The consensus sits at hold, with nine analysts in that camp and none at outperform. The most recent initiations and target moves tell a consistent story of downward pressure: Wells Fargo initiated at Underweight with a $15 target in March, UBS cut its target from $27 to $19 that same month, and Citigroup trimmed to $23 from $28 in January. Morgan Stanley has carried an Underweight for months. The lone contrarian voice is DA Davidson, which holds a Buy with a $30 target. With HOG closing at $23.62 — up 21% over the past month — the stock has already run through or past several of the bear-case targets. The mean analyst target of around $21.67 now sits below the current price, a setup that typically generates caution rather than conviction. The EV/EBITDA of 17.3x has expanded by over 3 turns in the past 30 days, tracking the price rally. One standout from the factor model: the EPS surprise percentile is 95, meaning HOG has consistently beaten estimates — that history could matter on May 5.
Insider activity reinforced the bullish lean from management. CEO Artie Starrs bought 15,000 shares at $19.10 in early March, a $286,500 purchase. Director Lori Flees added 4,000 shares at roughly the same price. Net insider buying over 90 days reached about 46,800 shares, worth around $900,000. These purchases were made when the stock was trading well below current levels, giving management a 24% paper gain in roughly seven weeks. That kind of executive buying at multi-year lows tends to generate attention, particularly in a stock where the bear case has been loudly argued by the Street.
The May 5 event is more than a routine earnings print. HOG confirmed it will present its new strategic plan on the same day — a potentially significant catalyst given the depth of the restructuring debate around the brand. The bear case centres on declining HDMC unit sales, gross margins that fell to 26.4% in Q3 2025, and rising tariff and FX headwinds. The bull case points to Touring and Adventure Touring shipment growth, a 37% domestic heavyweight market share, and signs that lower-priced bikes are gaining volume. The last two earnings reactions were relatively muted — up 2.2% the day after the February print, and down 0.1% in the prior period — suggesting the stock doesn't typically make dramatic one-day moves on results alone. The strategic plan could change that dynamic.
What to watch on May 5: whether management's revised strategy is credible enough to pull analyst targets above the current price, and whether short sellers who covered this week were early, or right.
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