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

Zacks Equity Research

Garmin (GRMN) closed at $87.23 in the latest trading session, marking a +0.97% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.41%. At the same time, the Dow added 0.57%, and the tech-heavy Nasdaq gained 0.7%.

Prior to today's trading, shares of the maker of personal navigation devices had gained 2.41% over the past month. This has outpaced the Computer and Technology sector's gain of 2.38% and the S&P 500's gain of 2.04% in that time.

GRMN will be looking to display strength as it nears its next earnings release, which is expected to be October 30, 2019. On that day, GRMN is projected to report earnings of $0.94 per share, which would represent a year-over-year decline of 6%. Our most recent consensus estimate is calling for quarterly revenue of $863.92 million, up 6.66% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.90 per share and revenue of $3.60 billion. These totals would mark changes of +5.69% and +7.58%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for GRMN. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. GRMN is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note GRMN's current valuation metrics, including its Forward P/E ratio of 22.18. For comparison, its industry has an average Forward P/E of 21.01, which means GRMN is trading at a premium to the group.

Also, we should mention that GRMN has a PEG ratio of 3.02. 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. The Electronics - Miscellaneous Products industry currently had an average PEG ratio of 1.53 as of yesterday's close.

The Electronics - Miscellaneous Products industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 85, which puts it in the top 34% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow GRMN in the coming trading sessions, be sure to utilize Zacks.com.


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