{"id":44625,"date":"2015-06-17T19:55:00","date_gmt":"2015-06-17T19:55:00","guid":{"rendered":"https:\/\/wp2.inovestor.com\/2015\/06\/garmin-ltd-grmn\/"},"modified":"2015-06-17T19:55:00","modified_gmt":"2015-06-17T19:55:00","slug":"garmin-ltd-grmn","status":"publish","type":"post","link":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/","title":{"rendered":"Garmin Ltd (GRMN)"},"content":{"rendered":"

In this week\u2019s content analysis, we will be drawing parallels between StockPointer\u2019s reports on Garmin Ltd and a recent Globe and Mail article (link<\/a>) covering the company. David Milstead, in his article \u201cGarmin: Is the GPS maker the next BlackBerry\u201d, published June 11th, brings to light many of the difficulties that Garmin has faced in recent years\u2014as well as those it can expect to encounter in the future\u2014because of the widespread development on smartphones with integrated GPS functionalities. Thankfully, Garmin has been successful at diversifying its sources of revenue: 75% of the company\u2019s 2007 revenue stemmed from automobile GPS sales, down to only 40% today. Fitness devices now represent the fastest growing business segment, and demonstrates the highest potential moving forward.\u00a0 Download <\/a><\/p>\n

This strategic repositioning has slowed the fall in its economic performance, but EVA clearly indicates that the company is no longer able to generate shareholder wealth\u2014its 12-month EVA has been negative since September 2014. Over the fiscal year finishing with its Q1 2015 results, Garmin\u2019s NOPAT (net operating profit after tax) was $366.1M; NOPAT was $698.3M over the prior 12-month period. Meanwhile, return on capital, now at 8.5%, is the lowest in five years, and is currently below the company\u2019s cost of capital at 9.6%.<\/p>\n

From a value perspective, GRMN is trading at a P\/IV ratio of 1.52, indicating a share price well above its intrinsic value, and representing considerable investment risk. Further, intrinsic value has been dropping on a fairly consistent basis since 2010. Future growth value (FGV) tells the same story: market value is presently 55% above current operating value (COV), despite the absence of any real top or bottom-line growth.<\/p>\n

You\u2019ll note that we held GRMN in our ADR model portfolio from August 2010 ($28.51) to October 2014 (55.48), at which date we sold the position due to its first ever negative-EVA quarter. It doesn\u2019t appear that Garmin\u2019s situation has, for the moment, improved. The arrival of new competitors in the fitness device space (Fitbit, Google, Apple, etc.) may further complicate the outlook facing Garmin\u2019s management.<\/p>\n","protected":false},"excerpt":{"rendered":"

In this week\u2019s content analysis, we will be drawing parallels between StockPointer\u2019s reports on Garmin Ltd and a recent Globe and Mail article (link) covering the company. David Milstead, in his article \u201cGarmin: Is the GPS maker the next BlackBerry\u201d, published June 11th, brings to light many of the difficulties that Garmin has faced in […]<\/p>\n","protected":false},"author":14,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[619],"tags":[660],"class_list":["post-44625","post","type-post","status-publish","format-standard","hentry","category-intelligence-en-us","tag-us-en-us"],"acf":[],"yoast_head":"\nGarmin Ltd (GRMN) - Inovestor<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Garmin Ltd (GRMN)\" \/>\n<meta property=\"og:description\" content=\"In this week\u2019s content analysis, we will be drawing parallels between StockPointer\u2019s reports on Garmin Ltd and a recent Globe and Mail article (link) covering the company. David Milstead, in his article \u201cGarmin: Is the GPS maker the next BlackBerry\u201d, published June 11th, brings to light many of the difficulties that Garmin has faced in […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\" \/>\n<meta property=\"og:site_name\" content=\"Inovestor\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Inovestor\/\" \/>\n<meta property=\"article:published_time\" content=\"2015-06-17T19:55:00+00:00\" \/>\n<meta name=\"author\" content=\"Inovestor\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Inovestor_\" \/>\n<meta name=\"twitter:site\" content=\"@Inovestor_\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Inovestor\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\"},\"author\":{\"name\":\"Inovestor\",\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/person\/6616b197e129a7a95f3107103c871092\"},\"headline\":\"Garmin Ltd (GRMN)\",\"datePublished\":\"2015-06-17T19:55:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\"},\"wordCount\":343,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#organization\"},\"keywords\":[\"US\"],\"articleSection\":[\"Intelligence\"],\"inLanguage\":\"en-USA\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\",\"url\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\",\"name\":\"Garmin Ltd (GRMN) - Inovestor\",\"isPartOf\":{\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#website\"},\"datePublished\":\"2015-06-17T19:55:00+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#breadcrumb\"},\"inLanguage\":\"en-USA\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.inovestor.com\/en-us\/research-platform\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Garmin Ltd (GRMN)\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#website\",\"url\":\"https:\/\/www.inovestor.com\/en-ca\/\",\"name\":\"Inovestor\",\"description\":\"Make investment decisions that matter most\",\"publisher\":{\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.inovestor.com\/en-ca\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-USA\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#organization\",\"name\":\"Inovestor\",\"url\":\"https:\/\/www.inovestor.com\/en-ca\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-USA\",\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/www.inovestor.com\/wp-content\/uploads\/2022\/04\/Inovestor-logo-high-res.png\",\"contentUrl\":\"https:\/\/www.inovestor.com\/wp-content\/uploads\/2022\/04\/Inovestor-logo-high-res.png\",\"width\":1581,\"height\":422,\"caption\":\"Inovestor\"},\"image\":{\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/logo\/image\/\"},\"sameAs\":[\"https:\/\/www.facebook.com\/Inovestor\/\",\"https:\/\/x.com\/Inovestor_\",\"https:\/\/www.linkedin.com\/company\/inovestor\"]},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/person\/6616b197e129a7a95f3107103c871092\",\"name\":\"Inovestor\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-USA\",\"@id\":\"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/87cd3105a1d74b889db7d26a60a8f3d3611a70d6e08baa4865bc6c8d091834b4?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/87cd3105a1d74b889db7d26a60a8f3d3611a70d6e08baa4865bc6c8d091834b4?s=96&d=mm&r=g\",\"caption\":\"Inovestor\"},\"url\":\"https:\/\/www.inovestor.com\/en-us\/author\/inovestor\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Garmin Ltd (GRMN) - Inovestor","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/","og_locale":"en_US","og_type":"article","og_title":"Garmin Ltd (GRMN)","og_description":"In this week\u2019s content analysis, we will be drawing parallels between StockPointer\u2019s reports on Garmin Ltd and a recent Globe and Mail article (link) covering the company. David Milstead, in his article \u201cGarmin: Is the GPS maker the next BlackBerry\u201d, published June 11th, brings to light many of the difficulties that Garmin has faced in […]","og_url":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/","og_site_name":"Inovestor","article_publisher":"https:\/\/www.facebook.com\/Inovestor\/","article_published_time":"2015-06-17T19:55:00+00:00","author":"Inovestor","twitter_card":"summary_large_image","twitter_creator":"@Inovestor_","twitter_site":"@Inovestor_","twitter_misc":{"Written by":"Inovestor","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#article","isPartOf":{"@id":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/"},"author":{"name":"Inovestor","@id":"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/person\/6616b197e129a7a95f3107103c871092"},"headline":"Garmin Ltd (GRMN)","datePublished":"2015-06-17T19:55:00+00:00","mainEntityOfPage":{"@id":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/"},"wordCount":343,"commentCount":0,"publisher":{"@id":"https:\/\/www.inovestor.com\/en-ca\/#organization"},"keywords":["US"],"articleSection":["Intelligence"],"inLanguage":"en-USA","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/","url":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/","name":"Garmin Ltd (GRMN) - Inovestor","isPartOf":{"@id":"https:\/\/www.inovestor.com\/en-ca\/#website"},"datePublished":"2015-06-17T19:55:00+00:00","breadcrumb":{"@id":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#breadcrumb"},"inLanguage":"en-USA","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.inovestor.com\/en-us\/2015\/06\/garmin-ltd-grmn\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.inovestor.com\/en-us\/research-platform\/"},{"@type":"ListItem","position":2,"name":"Garmin Ltd (GRMN)"}]},{"@type":"WebSite","@id":"https:\/\/www.inovestor.com\/en-ca\/#website","url":"https:\/\/www.inovestor.com\/en-ca\/","name":"Inovestor","description":"Make investment decisions that matter most","publisher":{"@id":"https:\/\/www.inovestor.com\/en-ca\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.inovestor.com\/en-ca\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-USA"},{"@type":"Organization","@id":"https:\/\/www.inovestor.com\/en-ca\/#organization","name":"Inovestor","url":"https:\/\/www.inovestor.com\/en-ca\/","logo":{"@type":"ImageObject","inLanguage":"en-USA","@id":"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/logo\/image\/","url":"https:\/\/www.inovestor.com\/wp-content\/uploads\/2022\/04\/Inovestor-logo-high-res.png","contentUrl":"https:\/\/www.inovestor.com\/wp-content\/uploads\/2022\/04\/Inovestor-logo-high-res.png","width":1581,"height":422,"caption":"Inovestor"},"image":{"@id":"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/Inovestor\/","https:\/\/x.com\/Inovestor_","https:\/\/www.linkedin.com\/company\/inovestor"]},{"@type":"Person","@id":"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/person\/6616b197e129a7a95f3107103c871092","name":"Inovestor","image":{"@type":"ImageObject","inLanguage":"en-USA","@id":"https:\/\/www.inovestor.com\/en-ca\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/87cd3105a1d74b889db7d26a60a8f3d3611a70d6e08baa4865bc6c8d091834b4?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/87cd3105a1d74b889db7d26a60a8f3d3611a70d6e08baa4865bc6c8d091834b4?s=96&d=mm&r=g","caption":"Inovestor"},"url":"https:\/\/www.inovestor.com\/en-us\/author\/inovestor\/"}]}},"_links":{"self":[{"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/posts\/44625","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/comments?post=44625"}],"version-history":[{"count":0,"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/posts\/44625\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/media?parent=44625"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/categories?post=44625"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.inovestor.com\/en-us\/wp-json\/wp\/v2\/tags?post=44625"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}