It's wonderful that Garmin's (NASDAQ:GRMN) products made the holiday bestsellers list. Unfortunately, sales are only part of the equation. If those high-volume items continued Garmin's trend toward lower-margin products, then per-unit profits suffered, dragging profit growth down with them. In the end, profits -- not sales -- drive a company's stock.

Plus, while 61% of Garmin's sales may have come from new products, that does raise a key question. What does Garmin's slowing rate of R&D growth as a percent of sales imply for future product launches? When a company's sales are so tethered to innovation that more than half of all sales come from new products, R&D had better keep up. Otherwise, soon it's not just facing a slowdown in sales growth, but a decline in total sales. If that happens, along with Garmin's trend toward lower-margin products, it's a recipe for disaster.

And as for the GPS navigation being built into cell phones, I think they represent a bigger threat than my dueling partner Alyce Lomax believes. If you look at the successful business models of carriers like AT&T (NYSE:T), Sprint Nextel (NYSE:S), and Verizon (NYSE:VZ), they have one thing in common. They tend to either give away the hardware or sell it at or below cost, and make up the difference on the subscription fee. The risk to an expensive hardware-sales-driven company like Garmin should be evident. Who's going to pay extra to buy something that'll eventually get bundled in with their cell phone service?

While I'm sure there's some price I'd be willing to pay for a profitable company like Garmin, the modest sell-off thus far this year hasn't been enough to excite the value investor within me. It's worth watching, but I'm not ready to buy yet.

There's more to this Duel! Go back and read the other three arguments, then vote for a winner.

Garmin and Amazon are Stock Advisor picks. AT&T is a former recommendation of that service.

At the time of publication, Fool contributor Chuck Saletta did not own shares of any company mentioned in this article. The Fool has a disclosure policy.