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Harley-Davidson Inc. (NYSE:HOG) announced today that it will be cutting bike shipments and lowered its earnings estimates significantly for the fiscal year 2007. The Milwaukee-based company said that it anticipates earning $3.69 to $3.77 a share for the year. The company earned $3.93 per share in 2006. Analysts had predicted a climb in Harley's earnings this year, with the average estimate for 2007 prior to today's announcement sitting at $4.12 a share.

The company says that it is lowering its third-quarter shipments to between 86,000 and 88,000 units from its prior estimate of 91,000 to 95,000 units. The full-year shipments of units is expected to be between 328,000 and 332,000. Last year the company shipped 349,196 units.

As if the news couldn't get any worse for Harley-Davidson, the company also slashed its growth estimates for 2008, saying the company expects between 4 and 7 percent earnings growth in 2008. The company had previously called for between 11 and 17 percent earnings growth in both 2008 and 2009. Harley-Davidson said today that it will no longer project 2009 earnings growth. The company said it is being hurt by lower operating margins and lighter than expected revenue growth.

Shares of HOG are trading lower by over 8% today on very heavy volume.

The earnings guidance from HOG is nothing short of dismal. It is extremely concerning to me that HOG is not only saying that August sales have tumbled, but also dramatically lowering 2008 estimates, and totally doing away with their guidance on 2009. This tells me that something bigger is going on at Harley-Davidson, not just a simple blip on the radar screen. The company is having trouble with operating margins and the demand for its newer products. HOG used to be a trusty stock that one could always count on, but it seems that the times have changed of late. I think investors would be wise to stay away from this company until they prove to be a worthy investment again.