Garmin Ltd (GRMN, Financial) has recently captured the attention of investors and financial analysts alike, thanks to its strong financial performance and promising market position. With a current share price of $203.22, Garmin Ltd has experienced a significant daily gain of 22.22%, and a three-month change of 14.07%. A detailed analysis, supported by the GF Score, indicates that Garmin Ltd is poised for substantial growth in the foreseeable future.
What Is the GF Score?
The GF Score is a proprietary stock performance ranking system developed by GuruFocus. It evaluates stocks based on five key aspects: financial strength, profitability, growth, GF Value, and momentum. These aspects are weighted differently and have been backtested from 2006 to 2021, showing a strong correlation with long-term stock performance. Stocks with higher GF Scores typically yield higher returns. For Garmin Ltd, the GF Score is an impressive 94 out of 100, indicating a high potential for outperformance.
- Financial strength rank: 8/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 3/10
- Momentum rank: 9/10
Understanding Garmin Ltd's Business
Garmin Ltd operates in a unique niche, producing GPS-enabled hardware and software across five key verticals: fitness, outdoors, auto, aviation, and marine. With a market cap of $39.06 billion and annual sales of $5.65 billion, Garmin boasts an operating margin of 22.15%. The company's diverse product range caters to specialized activities such as scuba diving and sailing, relying on licensing mapping data to enhance its offerings. Garmin's global presence spans 100 countries, with sales through distributors and partnerships with original equipment manufacturers.
Financial Strength Breakdown
Garmin Ltd's financial resilience is evident in its robust balance sheet and strategic debt management. With an Altman Z-Score of 12.58, the company demonstrates a strong buffer against financial distress. Additionally, its minimal Debt-to-Revenue ratio of 0.02 underscores a prudent approach to leveraging, further solidifying its financial health.
Profitability and Growth Metrics
Garmin Ltd stands out with a Profitability Rank of 10/10, supported by a Piotroski F-Score that highlights its strong financial condition. The company's consistent operational performance is reflected in its 4.5-star Predictability Rank. Growth has been equally impressive, with a 3-Year Revenue Growth Rate of 7.7%, outperforming 62.26% of peers in the Hardware industry. This is complemented by a notable increase in EBITDA over the past few years.
Conclusion
Considering Garmin Ltd's robust financial strength, impressive profitability, and consistent growth metrics, the GF Score highlights the company's exceptional position for potential market outperformance. Investors looking for similar opportunities can explore more companies with strong GF Scores using the GF Score Screen available to GuruFocus Premium members.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
