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Garmin (GRMN) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Garmin (GRMN) closed at $87.08 in the latest trading session, marking a +1.72% move from the prior day. This change outpaced the S&P 500's 1.09% gain on the day. At the same time, the Dow added 1.21%, and the tech-heavy Nasdaq gained 1.34%.

Coming into today, shares of the maker of personal navigation devices had gained 0.11% in the past month. In that same time, the Computer and Technology sector lost 0.65%, while the S&P 500 lost 1.17%.

Investors will be hoping for strength from GRMN as it approaches its next earnings release, which is expected to be October 30, 2019. In that report, analysts expect GRMN to post earnings of $0.94 per share. This would mark a year-over-year decline of 6%. Meanwhile, our latest consensus estimate is calling for revenue of $863.92 million, up 6.66% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.90 per share and revenue of $3.60 billion, which would represent changes of +5.69% and +7.58%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for GRMN. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. GRMN is currently sporting a Zacks Rank of #1 (Strong Buy).

In terms of valuation, GRMN is currently trading at a Forward P/E ratio of 21.98. This represents a premium compared to its industry's average Forward P/E of 20.1.

We can also see that GRMN currently has a PEG ratio of 2.99. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. GRMN's industry had an average PEG ratio of 1.68 as of yesterday's close.

The Electronics - Miscellaneous Products industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 82, putting it in the top 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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