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Harley-Davidson's turnaround is far from certain and the stock could fall 20%, Morgan Stanley says

A mechanic works on a motorcycle at a Harley-Davidson showroom and repair shop in Lindon, Utah, on Monday, April 19, 2021.
George Frey | Bloomberg | Getty Images

Investors have gotten ahead of themselves on Harley-Davidson's turnaround story, and the stock is due for a major pullback, according to Morgan Stanley.

The investment firm downgraded the motorcycle company to underweight from equal-weight after the stock, long plagued by sluggish and even negative sales growth, has ripped higher in recent months. Shares are up 31% year to date and are trading at their highest level since 2018.

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