Garmin stock is the IBD Stock Of The Day as shares of the outdoor recreation, fitness and navigation device maker park in a buy zone.
On Tuesday, Garmin stock broke out of a flat base at a buy point of 171.64, according to IBD MarketSurge charts. The 5% buy zone extends to 180.22, based on IBD trading principles.
In late morning trades on the stock market today, Garmin stock dipped a fraction to close at 173.
The stock action comes two weeks before the Olathe, Kan.-based company is due to release results for the second quarter on July 31.
Analysts polled by FactSet expect Garmin to earn an adjusted $1.43 a share on sales of $1.42 billion. That would translate to a 1% decline in earnings and a 7% increase in revenue.
Garmin's sales and earnings have accelerated for the past four quarters, but analysts see that streak ending with the Q2 report.
Shares Up Since Q1 Report
In intraday trading Wednesday, Garmin stock hit a nearly three-year high of 174.51. It notched its all-time high of 178.81 in August 2021.
In a bullish sign, Garmin stock has found support near its 50-day moving average line in recent weeks.
Garmin reports its results in five business segments: fitness, outdoor, aviation, marine and automotive. Last year, outdoor products were the largest category at 32% of revenue, followed by fitness at 26%. Marine contributed 18% of sales, aviation 16% and auto 8%.
Garmin stock rocketed after the company reported much better-than-expected results for the first quarter on May 1.
Garmin Stock On Three IBD Lists
On a conference call with analysts, Chief Executive Cliff Pemble credited Garmin's results to robust demand fueled by its innovative products. He noted that sports and fitness devices, such as smartwatches for runners, sold particularly well in the March quarter.
Garmin's customer base is less impacted by the cautious consumer spending trends seen in other markets.
"Generally, our customer base (is) in groups that are probably less affected by the overall sentiment that you hear broadly about," Pemble said. "We certainly have products across all kinds of price ranges, but mostly our products tend to be products with high innovation and high desirability."
Garmin stock is on three IBD lists: Big Cap 20, Global Leaders and Tech Leaders.
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