Garmin Stock Summary
It is difficult to imagine a more difficult environment for Garmin stock, than the 2008 economy. With automobile sales and consumer discretionary spending falling, it has been a rough one for Garmin. The stock has dropped nearly 64% from January to August, a brutal shake out. What does the Garmin agreement with Target stock mean?Garmin Ltd (NASDAQ: GRMN) is a technology company concentrated on GPS positioning devices in the automobile, marine, aviation, and fitness/outdoors sectors. Garmin utilizes the satellite system maintained by the US Department of Defense. The aviation segment garners about 13% of GRMN sales, marine 10%, fitness/outdoors 16%, and 60% for automobiles. The company continues to diversify. In 2006, it produced 70 new products, as management had predicted. Some of the most important products of Garmin stock in the first half of 2008 were the Garmin Nuvi 350, Garmin 2720, Garmin 305, and Garmin 660. Each of these products contibuted strongly to the Garmin stock bottom line, despite a tough slow down in sales.
Garmin Stock Earnings History:
Q1 2007: up 27.1%
Q2 2007: up 43.9%
Q3 2007: up 43.2%
Q4 2007: up 33.6%
Q1 2008: up 4.6%
Q2 2008:
Garmin next earnings report: Q3 2008: $0.94 E
Garmin stock itself is based in the Cayman Islands, but its manufacturing is done in Taiwan and the US. Most of GRMN's consumer products are produced in Shijr, Taiwan. The company expects to double its capacity in Taiwan through the purchase of another facilities in Jhongli, Taiwan, which opened in May 2006. The company's marine products are produced in Olathe, Kansas, United States. The company sells its products through distributors and retailers and also offers its products to OEM manufacturers for direct integration into third party products.
As a sector, the global positioning market is expected to grow in the double digits for some time to come. The strongest growth for Garmin stock of late has been the automotive division which grew 170% in 2006 and around 90% in 2007. The company hopes to leverage agreements with automobile manufacturers to include their devices on new cars, especially in the higher end markets. The outdoor/fitness market also has been enjoying a strong growth trend for Garmin. The company hopes to continue to produce new products to reach serious runners and dog owners with positioning devices that improve their lives.
Garmin's main competitor is European TomTom, which can be found along side Garmin Ltd. (NASDAQ: GRMN) devices in the US at places like Best Buy. TomTom stock (AMS: TOM2) is traded in Amsterdam.As of April 1, TomTom had extended its tender offer for Tele Atlas until May 30, 2008. it did shore up its agreement with soon-to-be Nokia-owned Navteq to provide map sharing for its devices. Some believe that with TomTom's imminent acquisition of TeleAtlas, that the company will be prime for a takeover by a larger technology company like Microsoft of Google.