The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Garmin beat expectations on revenue and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share expanded significantly.
Gross margin increased, operating margin was steady, and net margin grew.
Garmin reported revenue of $909.6 million. The 12 analysts polled by S&P Capital IQ anticipated sales of $771.2 million on the same basis. GAAP reported sales were 8.6% higher than the prior-year quarter's $837.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.85. The 14 earnings estimates compiled by S&P Capital IQ forecast $0.65 per share. GAAP EPS of $0.85 for Q4 were 25% higher than the prior-year quarter's $0.68 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 47.7%, 240 basis points better than the prior-year quarter. Operating margin was 22.0%, about the same as the prior-year quarter. Net margin was 18.2%, 230 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $576.1 million. On the bottom line, the average EPS estimate is $0.44.
Next year's average estimate for revenue is $2.67 billion. The average EPS estimate is $2.62.
The stock has a two-star rating (out of five) at Motley Fool CAPS. Among 1,309 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,220 give Garmin a green thumbs-up, and 89 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Garmin is hold, with an average price target of $35.46.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.