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Garmin (GRMN) Q1 Earnings: Will it Pull Off a Surprise?
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Garmin Ltd. (GRMN - Free Report) , a leading provider of navigation, communication and information devices, is slated to report first-quarter 2017 results on May 3 before the bell.
The company has a Zacks Rank #3 (Hold) and an Earnings ESP of 0.00%, a combination that constrains surprise prediction. This is because per our proven model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 to beat estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
We don’t recommend Sell-rated stocks (Zacks Rank #4 or #5) going into the earnings announcement.
However, Garmin’s surprise history has been quite impressive, since the company has beaten estimates in each of the last four quarters with an average positive surprise of 27.79%.
Year to date, the stock has underperformed the Zacks Electronics - Miscellaneous Products industry. It gained 4.85% compared with the industry’s gain of 10.24%.
What Happened in the Fourth Quarter
Garmin’s fourth-quarter earnings surpassed the Zacks Consensus Estimate on revenues that also beat estimates. The results were driven by solid performance in aviation, marine, outdoor and fitness segments. The auto segment however recorded revenue decline.
What We Are Watching this Time
Product line expansion continues to be Garmin’s top priority. In the fourth quarter, the company launched fenix 5 series with three designs, all equipped with Garmin Elevate wrist heart rate technology and QuickFit band replacement system. Garmin also launched new touchscreen and keyed chartplotter combo offerings in its popular GPSMAP product line.
At the CES show, Garmin unveiled its next generation Drive series PNDs that feature extended safety and driver awareness capabilities and WIFI for updating maps and other stored content. We expect that Garmin will continue to focus on innovation, diversification and market expansion to explore growth opportunities in all business segments.
Garmin focuses on delivering innovative products to the market, offering a complete experience via compelling form factors, wireless connectivity and sensors. This along with contribution from acquisitions is a positive. However, the secular decline in PNDs, increasing competition and pricing pressures are concerns.
Stocks to Consider
Here are 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:
Mettler-Toledo International, Inc. (MTD - Free Report) with an Earnings ESP of +0.33% and a Zacks Rank #2.
The Priceline Group Inc. with Earnings ESP of +2.06% and a Zacks Rank #3.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
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Garmin (GRMN) Q1 Earnings: Will it Pull Off a Surprise?
Garmin Ltd. (GRMN - Free Report) , a leading provider of navigation, communication and information devices, is slated to report first-quarter 2017 results on May 3 before the bell.
The company has a Zacks Rank #3 (Hold) and an Earnings ESP of 0.00%, a combination that constrains surprise prediction. This is because per our proven model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 to beat estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
We don’t recommend Sell-rated stocks (Zacks Rank #4 or #5) going into the earnings announcement.
However, Garmin’s surprise history has been quite impressive, since the company has beaten estimates in each of the last four quarters with an average positive surprise of 27.79%.
Year to date, the stock has underperformed the Zacks Electronics - Miscellaneous Products industry. It gained 4.85% compared with the industry’s gain of 10.24%.
What Happened in the Fourth Quarter
Garmin’s fourth-quarter earnings surpassed the Zacks Consensus Estimate on revenues that also beat estimates. The results were driven by solid performance in aviation, marine, outdoor and fitness segments. The auto segment however recorded revenue decline.
What We Are Watching this Time
Product line expansion continues to be Garmin’s top priority. In the fourth quarter, the company launched fenix 5 series with three designs, all equipped with Garmin Elevate wrist heart rate technology and QuickFit band replacement system. Garmin also launched new touchscreen and keyed chartplotter combo offerings in its popular GPSMAP product line.
At the CES show, Garmin unveiled its next generation Drive series PNDs that feature extended safety and driver awareness capabilities and WIFI for updating maps and other stored content. We expect that Garmin will continue to focus on innovation, diversification and market expansion to explore growth opportunities in all business segments.
Garmin Ltd. Price and EPS Surprise
Garmin Ltd. Price and EPS Surprise | Garmin Ltd. Quote
Summing Up
Garmin focuses on delivering innovative products to the market, offering a complete experience via compelling form factors, wireless connectivity and sensors. This along with contribution from acquisitions is a positive. However, the secular decline in PNDs, increasing competition and pricing pressures are concerns.
Stocks to Consider
Here are 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:
DragonWave with an Earnings ESP of +8.82% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Mettler-Toledo International, Inc. (MTD - Free Report) with an Earnings ESP of +0.33% and a Zacks Rank #2.
The Priceline Group Inc. with Earnings ESP of +2.06% and a Zacks Rank #3.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
See today's Zacks "Strong Sells" absolutely free >>.