Stock of the Day

March 17, 2020

Garmin (GRMN)

$224.67
-$4.34 (-1.9%)
Market Cap: $44.06B

About Garmin

Garmin Ltd. designs, develops, manufactures, markets, and distributes a range of wireless devices worldwide. Its Fitness segment offers running and multi-sport watches; cycling products; smartwatch devices; scales and monitors; and fitness accessories. This segment also provides Garmin Connect and Garmin Connect Mobile, which are web and mobile platforms where users can track and analyze their fitness, activities and workouts, and wellness data; and Connect IQ, an application development platform. The company's Outdoor segment offers adventure watches, outdoor handhelds and satellite communicators, golf devices, consumer automotive devices, and dog devices, as well as InReach and Gramin response communication device. Its Aviation segment designs, manufactures, and markets various aircraft avionics solutions, including integrated flight decks, electronic flight displays and instrumentation, navigation and communication products, automatic flight control systems and safety-enhancing technologies, audio control systems, engine indication systems, traffic awareness and avoidance solutions, ADS-B and transponders, weather information and avoidance solutions, datalink and connectivity solutions, and various services. The company's Marine segment provides chartplotters and multi-function displays, cartography products, fishfinders, sonar products, autopilot systems, radars, compliant instrument displays and sensors, VHF communication radios, handhelds and wearable devices, sailing products, audio products and accessories, digital switching products, and trolling motors. Its Auto segment offers embedded domain controllers and infotainment units; and software, map database, cameras, wearables, and automotive solutions. The company sells its products through independent retailers, dealers, distributors, installation and repair shops, and original equipment manufacturers, as well as online webshop. Garmin Ltd. was founded in 1989 and is based in Schaffhausen, Switzerland.

Garmin Bull Case

Here are some ways that investors could benefit from investing in Garmin Ltd.:

  • Garmin Ltd. recently reported earnings per share of $2.41, significantly exceeding analysts' expectations of $1.90, indicating strong financial performance and effective management.
  • The company's revenue for the latest quarter was $1.82 billion, surpassing estimates of $1.70 billion, showcasing robust demand for its products.
  • Garmin Ltd.'s stock price has seen a notable increase, currently trading at $243.13, reflecting positive market sentiment and investor confidence.
  • Institutional investors hold a significant portion of Garmin Ltd.'s stock, with 81.60% ownership, suggesting strong institutional confidence in the company's future prospects.
  • Recent upgrades from research firms, including a target price increase from Tigress Financial to $265.00, indicate a bullish outlook on the stock's potential growth.

Garmin Bear Case

Investors should be bearish about investing in Garmin Ltd. for these reasons:

  • Despite strong earnings, some analysts have issued sell ratings, indicating potential concerns about the stock's valuation and future performance.
  • Garmin Ltd. has a relatively high P/E ratio of 30.85, which may suggest that the stock is overvalued compared to its earnings, potentially limiting future price appreciation.
  • Recent insider selling, including a transaction by the CFO who sold 1,761 shares, could raise concerns about the company's internal confidence and future outlook.
  • Market volatility and economic uncertainties could impact consumer spending on Garmin's products, affecting sales and revenue growth.
  • Some analysts have set conservative price targets, with an average consensus target of $183.83, which may indicate limited upside potential in the near term.

Recent News