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Feb 23

Garmin Beats Q4 Targets On Strong Fitness, Outdoor Device Sales – Investor’s Business Daily

Fitness Comments Off on Garmin Beats Q4 Targets On Strong Fitness, Outdoor Device Sales – Investor’s Business Daily

Garmin reported strong Q4 sales of wearable devices, such as its Approach X40 GPS golf band with wrist-based heart rate and activity tracking. (Garmin)

Garmin (GRMN) stock jumped Wednesday after the maker ofnavigation, fitness and outdoor recreation devices beat Wall Street's targets for thefourth quarter.

Garmin shares surged on the stock market today, up 7.3% to 54.15after nearly hitting a buy point and a more than six-month high.Garmin stock has been consolidating over the past 29 weeks and has a buy point of 56.29.

Garmin earned 73 cents a share excluding items, down 1% from the year-earlier quarter, on sales of $861 million, up 10%. Analysts polled by Thomson Reuters expected the Olathe, Kan.-based company to earn 57 cents a share on sales of $793 million.

The company's largest product segment, fitness devices, saw sales rise 20% to $274 million. Its second-largest group, automotive, saw sales fall 17% to $227 million and was the only one of the company's five segments to decline in Q4.

IBD'S TAKE: Garmin stock has a middlingIBD Composite Rating of 52, meaning it has outperformed 52% of stocks in key metrics over the past 12 months. It is ranked No. 4 out of 10stocks in IBD'sConsumer Products-Electronic industry group. To see which companies lead the group, visit the IBD Stock Checkup.

Garmin's outdoor segment posted the strongest growth, with sales up 46% to $175 million. Aviation sales rose 13% to $117 million and marine sales climbed 19% to $67 million.

Garmin's gross profit margin improved to 54.7% in Q4 from 52.9% in the year-earlier quarter.

For 2017, Garmin expects to earn $2.65 a share, down 6%, on sales of $3.02 billion, unchanged. The company sees continued growth inoutdoor, fitness, marine and aviation offset by ongoing declines in the automotive navigation device business.

While Garmin reported strong sales ofwearable devices for fitness and sports enthusiasts, rival Fitbit (FIT) has been struggling with sales of activity trackers. Fitbit is due to report Q4 results after the market close Wednesday.

"2016 was a remarkable year of growth driven by strong sales in our outdoor, fitness, marine and aviation segments," Garmin CEO Cliff Pemble said in a statement. "Entering 2017, we see additional growth opportunities ahead and we are well positioned to seize these opportunities with a strong lineup of great products."

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Wearable fitness device maker Fitbit late Wednesday reported worse-than-expected December quarter results. (Fitbit)

6:05 PM ET Wearable fitness device maker Fitbit late Wednesday reported worse-than-expected December-quarter results.

6:05 PM ET Wearable fitness device maker Fitbit late Wednesday reported worse-than-expected December-quarter...

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Garmin Beats Q4 Targets On Strong Fitness, Outdoor Device Sales - Investor's Business Daily

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