Third Avenue Value Fund’s new position in Harley-Davidson (HOG) in Q1 2026 puts fresh attention on the stock, as the fund responds to recent management changes and product and inventory adjustments.

Harley-Davidson’s recent management moves and product reset come against a backdrop where the share price has risen 8.18% over the past month and 37.94% over the past 90 days, yet the 3-year total shareholder return is down 18.10% and the 5-year total shareholder return is down 37.80%. This suggests short term momentum is picking up while longer term holders have experienced weaker outcomes.

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With Harley-Davidson’s share price near analyst targets and recent returns mixed across timeframes, the key question now is whether today’s valuation understates a potential recovery or if the market is already pricing in better days ahead.

Most Popular Narrative: 1% Overvalued

Harley-Davidson’s most followed narrative puts fair value at $25.45, just under the recent $25.67 close, framing a tight gap between model and market.

The new partnership in HDFS unlocks significant cash ($1.25b) and reduces leverage, enabling accelerated share buybacks and freeing up $300m for growth investments, which can directly support EPS and future revenue streams through both financial engineering and new business initiatives.

Curious what powers that fair value so close to today’s price? The narrative combines assumptions for earnings, margins, and share count into one tight valuation story.

Result: Fair Value of $25.45 (OVERVALUED)

However, Harley-Davidson still faces weak global motorcycle demand and tariff costs of US$75 to 90 million in 2026, which could strain margins and dealer health.

Another View: Harley-Davidson Through Earnings Multiples

While the Harley-Davidson narrative pegs fair value at $25.45 and labels the stock slightly overvalued, the earnings multiple tells a different story. A P/E of 11.7x sits below peers at 17.2x, the global auto industry at 14.4x, and even the 14.5x fair ratio the market could converge toward. For investors, that gap can mean less downside if sentiment cools or more upside if the multiple simply moves closer to those benchmarks. Which way do you think the crowd leans next?

Next Steps

The mix of short term momentum and longer term disappointment around Harley-Davidson can feel confusing, so move quickly from headlines to hard data and shape your own view by checking the 3 key rewards and 1 important warning sign

Looking for more Harley-Davidson investment ideas?

If Harley-Davidson has you checking your watchlist, do not stop there. Broaden your view with a few focused stock ideas that could help shape your next move.

• Target resilient income by reviewing companies in the 8 dividend fortresses and see which payouts might suit a long term portfolio.
• Spot potential mispricing by scanning the 45 high quality undervalued stocks for stocks where quality and price may not fully align.
• Reduce surprises by using the 66 resilient stocks with low risk scores to focus on companies with steadier risk profiles that can complement Harley-Davidson in your holdings.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.