Garmin Earnings Down; Share Up 30+% on better than Expected Earnings
Maybe things are better than expected for the economy? Garmin's sales were off 30% vs. year ago, as it's key segments were all down in sales, and its earnings were down 32% to $0.81 per share.... so why the stock jump? Apparently Wall St. consensus was for earnings of $0.51 per share and that's a lot better than expected. The market is still tough, and I am sure that Garmin is working hard to make sure that the promotions go off well, the inventories are managed well and prices are as low as possible to keep the product moving. Wall St. rewarded the over delivery by moving the Garmin stock; it closed at about $27 before the news and opened above $33 after the news.
CEO Min Kao said:
"While the macroeconomic conditions continue to dampen consumer demand, we are encouraged by the 53% sequential improvement in revenues in the second quarter. We are also pleased with the solid margins and earnings in the quarter achieved by the various initiatives that we have taken to improve productivity, reduce expenses and utilize the strength of our balance sheet.
The automotive/mobile segment continued to show sell‐through growth on a unit basis in both the North American and Asian markets and Garmin maintained its strong global market leadership position. The sequential improvement in pricing and margins in the quarter were on target with our expectations entering the quarter. We intend to continue to position ourselves to take advantage of the ongoing demand for portable navigation devices by delivering innovative solutions to the consumer. Our recently introduced 1200, 1300 and 1400 nüvi®series which offer affordable navigation solutions in a sleek form factor with pedestrian capabilities have been well received, and we continue to expand the utility of in‐vehicle navigation through the introduction of our first product designed specifically for the trucking market.
Read More in: Earnings Announcements | Garmin GPS News
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Posted by Scott Martin at August 6, 2009 6:21 AM
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