Garmin Sees Mixed Performance Ahead of Upcoming Earnings

In the latest trading session, Garmin's shares showed slight gains but lagged behind major indices. Investors await the upcoming earnings report, projected to reflect modest growth in earnings and revenue, which could impact stock performance positively or negatively depending on results.

Date: 05-10-2024

AI Rating: 6

Garmin's stock performance has been somewhat muted recently, showing a 6.44% loss over the past month and finishing the last session at $170.03. This performance is notably behind that of the Computer and Technology sector and the S&P 500, which saw gains of 5.76% and 3.15%, respectively. This could signal potential concerns among investors, especially as broader market trends might overshadow Garmin's steady state.

Looking forward, Garmin's upcoming earnings disclosure on October 30, 2024 is crucial, with analyst estimates anticipating $1.45 per share earnings, marking a year-over-year growth expectation of 2.84%. Additionally, quarterly revenue is projected to be $1.43 billion, indicating a year-over-year increase of 12.14%. These figures might provide a potential boost to stock prices if the company meets or exceeds expectations.

For the full year, analysts project earnings of $6.05 per share and revenue of $5.97 billion, reflecting year-over-year changes of +8.23% for earnings and +14.11% for revenue. If Garmin can deliver on these estimates, it may positively affect investor sentiment and lead to upward movement in stock prices.

Garmin currently holds a Zacks Rank of #3 (Hold), indicating a neutral outlook. The Forward P/E ratio stands at 27.95, which is significantly higher than the industry average of 17.8, suggesting that Garmin's stock may be perceived as overvalued relative to its peers. The PEG ratio of 2.93 also suggests that growth expectations are higher compared to the average of 2.25 in its industry.

In conclusion, while Garmin shows promise in upcoming earnings reports, the current performance trends and high valuation ratios may lead investors to exercise caution. The potential for a positive surprise in earnings could lead to a stock price rebound.

Stocks: GRMN