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Tuesday, October 31, 2006

A Quick Take On Harley Davidson (HOG)

By Yaser Anwar, CSC of Equity Investment Ideas

With the repurchase of 21+ million shares, $1+ billion, in 05 & almost 10 million shares in 2006, one can indeed say management has done a terrific job thus far.

Not only that, investors can expect further stock repurchases and dividend hikes as management utilizes FcF. This is a Warren Buffet type of company. From the past couple of years, management has been continuing a series of payout boosts (from 8% in 01 to 18% so far). In the 2nd Q, HOG increased its quarterly dividend by nearly 17%.

Last year the company had a short-term earnings blip and the stock fell 10 points, would have been a great buying point. That's exactly what Bill Nygren, one of the top value investors, of OakMark Fund (OAKLX) did. OakMark is one of HOG's Top Mutual Fund Holders.

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