Is Garmin’s Stock Overvalued?
October 28, 2022
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Garmin Ltd Stock Fair Value – Garmin ($NYSE:GRMN) is a technology company that designs, manufactures and markets global positioning system navigation, communication and information devices. Garmin’s stock has been under pressure in recent months, due to macroeconomic headwinds and contracting margins.
In our opinion, the stock is still overvalued, trading at a substantial premium compared to its peers. macroeconomic factors, including low consumer confidence and high inflation, are likely to continue creating headwinds for Garmin in the next quarters. GRMN’s stock is trading at a substantial premium compared to its peers, according to a set of traditional price multiples, which we believe were not justified in the volatile market environment.
Earnings
Is Garmin’s Stock Overvalued? Garmin Ltd. is a technology company that designs, develops, and markets global positioning system navigation and other wireless devices. The company’s products serve automotive, mobile, and marine markets. Compared to the previous year, there was a 0.0% decrease in total revenue and a 9.1% decrease in net income. Despite this decrease in net income, Garmin’s total revenue has increased from $4.2 billion to $5.0 billion in the last three years.
The company’s stock price has increased significantly over the past year, and some investors are concerned that the stock is now overvalued. While Garmin is a well-established company with a history of strong financial performance, the recent decrease in net income raises concerns about the company’s future growth potential.
Stock Price
Garmin’s stock has been in the news a lot lately, and most of the coverage has been negative. On Wednesday, the stock opened at $86.4 and closed at $84.9. This is a company that is worth watching closely in the coming days and weeks.
VI Analysis – Garmin Ltd Stock Fair Value
Its products include GPS devices, software, and services. The company’s fundamentals reflect its long term potential. The fair value of Garmin shares is around $126.0, calculated by VI Line. Now, Garmin stock is traded at $84.9, undervalued by 33%.
VI Peers
Its competitors include NetApp Inc, Jiangsu Leike Defense Technology Co Ltd, and Red Cat Holdings Inc.
– NetApp Inc ($NASDAQ:NTAP)
NetApp Inc is a American multinational storage and data management company headquartered in Sunnyvale, California. It is a member of the NASDAQ-100 and S&P 500. The company was founded in 1992 with an initial public offering in 1995. NetApp offers a wide range of products and services for enterprise storage, including software-defined storage, flash storage, converged systems, data management, and more. The company has a market cap of $14.66B as of 2022 and a Return on Equity of 100.42%.
– Jiangsu Leike Defense Technology Co Ltd ($SZSE:002413)
Jiangsu Leike Defense Technology Co Ltd is a Chinese company that specializes in the development and manufacture of defense products. The company has a market cap of 6.76B as of 2022 and a Return on Equity of -4.34%. Jiangsu Leike Defense Technology Co Ltd’s products include missiles, armored vehicles, and other defense products. The company is headquartered in Nanjing, China.
– Red Cat Holdings Inc ($NASDAQ:RCAT)
Red Cat Holdings Inc is a development stage company that focuses on acquiring, developing, and commercializing technology in the field of 3D printing. The company was founded in 2013 and is headquartered in Vancouver, Canada.
Red Cat has a market cap of $76.86M as of 2022 and a ROE of -11.27%. The company focuses on acquiring, developing, and commercializing technology in the field of 3D printing.
Summary
The company is known for its GPS and wearable technology products. The company’s products are used in automotive, aviation, marine, outdoor, and sports applications. Its product categories include GPS navigation, fitness tracking, and wearable devices. Garmin’s stock has been under pressure in recent years due to increased competition from smartphone manufacturers such as Apple and Samsung .
However, the company has been able to offset some of this pressure by expanding its product offerings into new categories such as drones and connected cars. Despite the challenges, Garmin remains a profitable company with a strong balance sheet. Given the company’s strong financial position and history of innovation, Garmin could be a compelling investment at the current price.
