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Garmin Ltd. Message Board

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  • steveredlish steveredlish Jan 1, 2007 8:53 PM Flag

    Give Me A Pass

    Wixieway,
    I think you are on the right page. The probelm with Ford is their balance sheet. I am just too chicken to buy Ford. The reality is that any company that can claim more than 10% of U.S. market share in any category can be very successful.

    The connection to Garmin is not irrelevant. It seems like Garmin longs expect Garmin to "own" the PND market at least here in the U.S. I believe Garmin will be the market leader for quite some time even though their market share will decline substantially - and also their margins.

    The good news is that institutional holdings of Garmin are fairly small. Those that have stayed away form Garmin are going to start buying - because they have to have a position or look stupid.

    Members of the Garmin board that are looking for a January sell off are going to be pretty upset unless the market tanks - which could happen. Best of luck with Ford. New management would get me really interested.

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    • Steve: "I believe Garmin will be the market leader for quite some time even though their market share will decline substantially - and also their margins."

      IMHO, product prices will decline, but margins will remain
      stable and market share will increase. That's because
      component costs will decline, R&D costs will be spread out
      over more units, and behind the brand name is intrinic value.

    • "It seems like Garmin longs expect Garmin to "own" the PND market at least here in the U.S. I believe Garmin will be the market leader for quite some time even though their market share will decline substantially - and also their margins."

      Again, this has been said for years......Go back 2 to 3 years on this message board.....same thing. But margins have held and market share has increased. Sony's entry into the market was a complete joke and Philipps could not bring one to market.

      In 5 years it will be Garmin and TomTom.....and PNDs will have evolved, due to Garmin's innovation, into something none of us could even imagine. Megellan margins suck and they are losing $$ trying to reestlabish themselves....they cannot keep it up.

      Margins may drop a percent or two.....but that is against over 60% growth in revenues and triple digit growth in PNDs.....

      • 1 Reply to stealthtrader1968
      • stealth,
        whoa, you must know something we don't. How do you know Magellan is losing money? That's a pretty strong claim, as they were taken private, and I have to assume they don't send you their results. I personally think they may be the long term competition with the greatest chance of staying with Garmin. The current owners paid almost nothing for them - less than $500M, I recollect. They have a well-established name, reputation, and technology, competing in auto, rec, aviation, and marine. Their Hertz branding keeps them in the game. The current owners will pump them up and find a buyer that wants to compete in a big way, and with good ownership they could within short order be real serious competition. They now consistently put 5 or more devices in the Amazon gps top 50, more than any other competitor. I don't think it behooves any of us to underestimate the competition, do you?

 
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