This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Investor Worries About Garmin Might Be Overblown

The company's portable GPS navigator, nuvi 660, is currently No. 2 on Amazon.com's (AMZN) electronics bestseller list, ahead of digital cameras and Apple's (AAPL) iPod.

Despite the growing competition and SiRF's announcement, Garmin could do better than its peers, says Scott Sutherland, an analyst with Wedbush Morgan.

Increasing competition has squeezed smaller device manufacturers and allowed Garmin to gain market share, Sutherland says in a research note.

"Garmin manufacturers its own PND devices, so it should have a better grip on inventory levels and should not have inventory building," he says.

Instead, Sutherland blames SiRF for a first-quarter guidance that was not conservative enough to start with and subsequently forced it to cut its outlook to adjust to market realities.

SiRF's original first-quarter guidance only expected a 23% to 29% decline in revenue in the first quarter from the fourth quarter whereas its new guidance expects a 38% to 40% decline over the same period.

Sutherland says his projections call for a decrease of 51% in the number of devices sold by Garmin in the first quarter compared to the fourth-quarter holiday season and a 40% revenue decline. He says those numbers are conservative enough to fall in line with Street expectations.

It also means the current weakness in Garmin based on SiRF's warning may not be as high as perceived. For the first quarter, analysts expect Garmin to report EPS of 77 cents on revenue of $733.3 million, compared with EPS of 64 cents on revenue of $492.1 million in the year-ago quarter.

For the full fiscal year, Garmin is expected to earn $4.51 on revenue of $4.47 billion, higher than EPS of $3.89 on revenue of $3.18 billion a year ago, according to Thomson First Call.

Know What You Own: GRMN operates in the technical instrument industry within the technology sector, and some of the other stocks in its field include Thermo Fisher Scientific (TMO), Agilent Technologies (A), SunPower Corporation (SPWR) and Applera Corp-Applied Biosystems Group (ABI). These stocks were recently trading at ($56.78, +1.88%), ($30.20, -0.49%), ($72.05, +5.58%) and ($33.46, +2.70%) respectively. For more on the value of knowing what you own, visit TheStreet.com's Investing A-to-Z section.

2 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,098.45 +18.88 0.11%
S&P 500 2,003.37 +6.63 0.33%
NASDAQ 4,580.2710 +22.5760 0.50%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs