Will Garmin (GRMN) Beat Estimates this Earnings Season?
Garmin Ltd. GRMN, a leading provider of navigation, communication and information devices, is expected to beat expectations when it reports second-quarter 2016 results on Jul 27.
Why a Likely Positive Surprise?
Our proven model shows that Garmin is likely to beat estimates this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Garmin has the right combination of the two key components.
Zacks ESP: Garmin currently has an Earnings ESP of +4.48%. This is because the Most Accurate estimate stands at 70 cents, while the Zacks Consensus Estimate is pegged lower at 67 cents.
Zacks Rank: Garmin carries a Zacks Rank #3, which when combined with an ESP of +4.48% make us reasonably confident of a positive surprise.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
What is Driving the Better-Than-Expected Results?
Garmin is riding high on acquisition and product line expansion. Recently, the company acquired DeLorme, the provider of the inReach series of affordable two-way satellite communication devices for consumers. This is helping the company to add device and recurring service revenues to the outdoor segment.
Garmin also started shipments of activity tracker vívoactive HR with Garmin Elevate wrist heart rate technology and the vívofit 3 with one year battery life. Management focuses on continued innovation to deliver compelling products across served markets.
However, macroeconomic challenges persist.
GARMIN LTD Price and EPS Surprise
GARMIN LTD Price and EPS Surprise | GARMIN LTD Quote
Other Stocks to Consider
Here are other some stocks, which you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Open Text Corp. OTEX with an Earnings ESP of +1.10% and Zacks Rank #1.
Silicon Motion Technology Corp. SIMO with an Earnings ESP of +18.84% and Zacks Rank #1.
Charter Communications, Inc. CHTR with an Earnings ESP of +404.76% and a Zacks Rank #2.
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OPEN TEXT CORP (OTEX): Free Stock Analysis Report
SILICON MOTION (SIMO): Free Stock Analysis Report
GARMIN LTD (GRMN): Free Stock Analysis Report
CHARTER COMM-A (CHTR): Free Stock Analysis Report
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