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Garmin (GRMN) Acquires Firstbeat Analytics, Boosts Portfolio

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Garmin Ltd. (GRMN - Free Report) recently acquired a privately-held company, Firstbeat Analytics Oy. However, the financial terms of the acquisition deal are not yet disclosed.

Headquartered in Jyvaskyla, Finland, Firstbeat Analytics is a physiological analytics company. It provides software that interprets various data collected from sensors in health, wellness, fitness and performance markets. The company’s software allows monitoring stress, sleep and respiration rate, among others, for consumer smartwatch makers.

Firstbeat Analytics is the consumer licensing business of Firstbeat Technologies. Garmin's purchase does not include Firstbeat Technologies' other businesses focused on corporate and sports customers.

Garmin Ltd. Price and Consensus

 

Deal Rationale

As healthcare has been touted as the next most happening growth frontier for technology stocks, most of the tech companies are trying to strengthen healthcare footprint on the back of AI, ML, AR/VR and data analytic initiatives.

The latest acquisition focused on personal health monitoring will help Garmin expand its market share in the fitness space.

Firstbeat Analytics transforms heartbeat data from consumer devices into personalized information. The company combines this data with mathematics using sensor data to provide advanced analytics and metrics in areas of stress, sleep, VO2 max, training status/load, training effect, respiration rate, calories burned, among others.

Notably, the deal will allow Garmin to provide smartwatch users with more valuable data, in turn helping them make better and more informed decisions about training and recovery.

The deal will also provide an edge to Garmin over competitors namely Casio, Xiaomi, Huawei, Amazfit and Suunto, among others, who have beenlicensing Firstbeat's technology.

Bottom Line

Strategic acquisitions and other deals have significantly contributed to Garmin's growth trajectory via expanding the product portfolio.

The company is experiencing notable success in all segments because of many newly added technologies that are gradually expanding and enabling it to enter new categories.

Garmin’s president and CEO said, “Having utilized Firstbeat’s innovative analytics across our product lines for more than a decade, we are excited to have the Firstbeat Analytics associates join the Garmin team, establishing us at the forefront of physiological analytics”. “Together with their team of physiologists, scientists and engineers, we look forward to providing Garmin customers with unmatched technology for greater performance, recovery and overall health.”

It is clear that the company is on the right track with regard to product offerings and expansion plans.

Notably, the recent acquisition will continue to help it in gaining momentum in the markets served by the company via improving the customer base. This will in turn aid Garmin’s top-line growth.

Zacks Rank & Stocks to Consider

Currently, Garmin carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Wayfair Inc. (W - Free Report) , eBay (EBAY - Free Report) and Inphi Corporation . While Wayfair and eBay sport a Zacks Rank #1 (Strong Buy), Inphi carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Wayfair, eBay, and Inphi is currently projected at 23%, 12.4% and 37.7%, respectively.

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