Harley-Davidson's (NYSE:HOG) Gross Margins May Surprise

Harley-Davidson (NYSE:HOG) was given an above-consensus EPS by UBS (NYSE:UBS), citing their expectations gross margins will be above consensus.

UBS says, "Harley will report Q4’10 results on January 25 before market open. We estimate EPS of $0.07, excluding restructuring charges vs. cons. Range of ($0.12) – ($0.18) excluding restructuring costs. Main driver of our above-consensus est. is our gross margin est. of 30%, well above implied guidance of 21-28%...We believe HOG’s standalone Harley-Davidson (i.e., ex-Buell) U.S. retail unit sales at the dealer level may have seen their first quarter of flat to up YOY unit sales since 2006.

UBS maintains a "Neutral" rating on Harley-Davidson (HOG), which closed Monday at $36.49, up $0.50, or 1.39 percent. UBS raised their price target on HOG from $31 to $37.