Garmin (GRMN) was once a leader in technology thanks to its GPS devices which put location finding ability
in the hands of the masses.
The company has expanded to other markets, including wearables, while it is still selling its traditional GPS devices too. But the growth really hasn’t been there for GRMN and questions are once again starting to swirl over the stock.
While GRMN stock has come back a bit in recent trading, investors should look to recent earnings estimate revisions for how GRMN stock might perform next.
A Look at GRMN Estimates
Analysts, who arguably are the people following the stock closer than anyone else, have been slashing their estimates for GRMN’s earnings left and right. In fact, over the past month not a single estimate has gone higher for GRMN though nine have gone lower for the current quarter and 11 have gone lower for
the current year.
The magnitude of these revisions has been pretty intense too, including a drop from 71 cents a share in EPS to 48 cents a share for the current quarter estimate, while the current year has seen a decline in its consensus of over 14% as well.
In fact, current EPS growth rates (year-over-year) are now abysmal, with the full year expected to decline by over 27%.
With these kinds of numbers and with the extreme competitive pressures building, it isn’t too surprising that GRMN stock has fallen to a Zacks Rank #5 (Strong Sell). Better opportunities are out there for most investors right now and you just have to know where to look.
Lean Towards These Two Stocks to Buy
If you are looking to stay in the same Zacks Industry, consider the small cap of GigOptix (GIG). This
security has earned itself a Zacks Rank #1 (Strong Buy) and is expected to see great growth this year. If that is too small, another area to look could be Harman International (HAR). This company has a Zacks Rank #2 (Buy) and it has a ‘B’ grade for Value.
Either way, both of these companies are expected to see strong growth numbers and could be better choices in today’s environment. This is especially true if you compare them to GRMN stock, which is struggling right now and could continue to face pressure in the near term as well.
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