Analysts cut their estimates for Garmin Ltd. Thursday, a day after the personal navigation device maker gave a weak first-quarter report and its stock fell to two-year lows.
On Wednesday, the Cayman Islands-based company posted profit and sales that did not reach analyst expectations. Garmin said it still expects to reach its full-year profit and revenue forecasts, but acknowledged economic conditions are challenging and said its expectations "include some risk."
Lehman Brothers analyst Amir Rozwadowski reduced his profit estimates in 2008 and 2009, and reduced his price target to $47 per share from $51. He said Garmin's results are not a surprise because several other companies in the sector are feeling the effects of a market slowdown.
Rozwadowski expects those conditions to last for the next few quarters. He now expects the company to earn $4 per share in 2008, while Garmin currently expects a profit of $4.40 per share.
Soleil analyst Peter Friedland also reduced his estimates, and Merrill Lynch analyst Ronald Epstein downgraded the stock to "Neutral" from "Buy."
Baird analyst Reik Read said Garmin stock has reached an attractive price, as it is the leader in its sector and its aviation, marine and outdoor units have room for growth. He lowered his profit estimates, and slashed his price target to $56 per share from $76.
Garmin shares fell 11.9 percent Wednesday and closed at $40.90. The stock dropped as far as $39.75, its lowest price since March 2006.
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