The 10-second takeaway
For the quarter ended June 29 (Q2), Garmin beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank. Non-GAAP earnings per share dropped significantly. GAAP earnings per share shrank.
Margins contracted across the board.
Garmin reported revenue of $696.6 million. The 13 analysts polled by S&P Capital IQ looked for revenue of $665.8 million on the same basis. GAAP reported sales were 3.0% lower than the prior-year quarter's $718.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
EPS came in at $0.76. The 14 earnings estimates compiled by S&P Capital IQ forecast $0.66 per share. Non-GAAP EPS of $0.76 for Q2 were 22% lower than the prior-year quarter's $0.98 per share. GAAP EPS of $0.88 for Q2 were 7.4% lower than the prior-year quarter's $0.95 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
For the quarter, gross margin was 55.1%, 660 basis points worse than the prior-year quarter. Operating margin was 24.4%, 690 basis points worse than the prior-year quarter. Net margin was 24.8%, 110 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $632.2 million. On the bottom line, the average EPS estimate is $0.62.
Next year's average estimate for revenue is $2.56 billion. The average EPS estimate is $2.38.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 4,292 members out of 4,735 rating the stock outperform, and 443 members rating it underperform. Among 1,000 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 912 give Garmin a green thumbs-up, and 88 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 $37.56.
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