Garmin, a maker of devices for outdoor recreation, fitness and navigation, on Wednesday easily beat Wall Street's targets for the second quarter. It also raised its sales and earnings outlook for the full year. But Garmin stock fell after the report.
The Olathe, Kan.-based company earned an adjusted $1.58 a share on sales of $1.51 billion in the June quarter. Analysts polled by FactSet had expected earnings of $1.47 a share on sales of $1.42 billion. On a year-over-year basis, Garmin earnings increased 9% while sales rose 14%.
For the full year, Garmin now expects to earn an adjusted $6 a share on sales of $5.95 billion. That would translate to year-over-year growth of 7% in earnings and 14% in sales. Analysts had been modeling earnings of $5.88 a share on sales of $5.85 billion.
"Garmin delivered another impressive quarter of growth in both revenue and operating profit, made possible by an innovative product lineup and the strength of our diversified business model," Chief Executive Cliff Pemble said in a news release.
He added, "We are pleased with our results so far in 2024, which have exceeded our expectations and give us confidence to raise our full-year revenue and EPS guidance."
Garmin Stock Is On Four IBD Lists
Of the company's major product categories, fitness was the top performer, with sales rising 28% to $428 million in the June quarter. Growth in wearable devices fueled the category.
Sales of marine devices increased 26% to nearly $273 million, driven by the acquisition of JL Audio.
On the stock market today, Garmin stock fell 4.5% to close at 171.25. Garmin stock had been up in premarket trading.
Barclays analyst George Wang reiterated his equal weight rating on Garmin stock, but raised his price target to 181 from 166. In a client note, Wang said he is neutral on the stock because of its "lofty valuation."
On July 16, Garmin stock broke out of a flat base at a buy point of 171.64, according to IBD MarketSurge charts. The 5% buy zone of the breakout extends to 180.22.
On Tuesday, Garmin stock notched a regular-session record high of 179.76.
Garmin stock is on four IBD stock lists: IBD 50, Big Cap 20, Global Leaders and Tech Leaders.
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