Outdoor recreation, fitness and navigation device maker Garmin on Wednesday beat analyst estimates for the fourth quarter. It also revealed a proposed dividend increase and share buyback plan. Garmin stock rose on the news.
The Olathe, Kan.-based company earned an adjusted $1.72 a share on sales of $1.48 billion in the December quarter. Analysts polled by FactSet had expected Garmin earnings of $1.40 a share on sales of $1.42 billion. On a year-over-year basis, Garmin earnings increased 27% while sales rose 13%.
For the year ahead, Garmin predicted adjusted earnings of $5.40 a share on sales of $5.75 billion. Wall Street was modeling earnings of $5.56 a share on sales of $5.56 billion in 2024. In 2023, Garmin earned an adjusted $5.59 a share, up 9% year over year, on sales of $5.23 billion, up 8%.
"We are entering 2024 with strong momentum from our robust product lineup and have many product launches planned during the year," Chief Executive Cliff Pemble said in a news release.
Garmin Stock Pops After Report
On the stock market today, Garmin stock jumped 8.8% to close at 133.58.
With the advance, Garmin stock broke out of a flat base with a buy point of 129.32, according to IBD MarketSmith charts.
Of the company's five product categories, fitness was a top performer, with sales rising 22% to $412 million in the December quarter. Outdoor, marine and automotive also posted increases, with aviation the only decliner.
In other news, Garmin's board authorized a share repurchase program of up to $330 million. The board also proposed increasing the quarterly dividend to 75 cents a share from 73 cents. Shareholders will vote on the dividend hike at the company's annual meeting on June 7.
Garmin stock ranks second out of 17 stocks in IBD's consumer electronics industry group, according to IBD Stock Checkup. It has an IBD Composite Rating of 83 out of 99.
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