Garmin’s Adjusted Q2 Profit Beats View, but Revenue Forecast Cut (GRMN)

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GPS navigation maker Garmin Ltd. ( GRMN ) on Wednesday said its second quarter profit fell 17% from last year, hurt by one-time items, and cut its full-year revenue forecast amid currency exchange concerns.

The Cayman Islands-based company reported second quarter net income of $134.8 million, or 67 cents per share, compared with $161.9 million, or 81 cents per share, in the year-ago period. Excluding one-time items, adjusted profit was 85 cents per share.

Revenue rose 9% from last year, to $728.8 million.

On average, Wall Street analysts expected a smaller adjusted profit of 73 cents per share, on much lower revenue of $676.9 million.

Looking ahead, the company cut its full-year revenue forecast to a range of $2.8 billion to $3 billion, down from a prior outlook of $2.9 billion to $3.1 billion. Analysts currently expect $2.88 billion in revenue for the year.

Garmin shares rose $1.15, or +3.9%, in premarket trading Wednesday.

The Bottom Line
We have been avoiding shares of GRMN since our early June 2008 coverage began, when the stock was trading at $51.34. The company has a 5.11% dividend yield, based on last night's closing stock price of $29.35. The stock has technical support in the $24-$27 price area. If the shares can firm up, we see overhead resistance around the $34 price level. We would remain on the sidelines for now.

Garmin Ltd. ( GRMN ) is not recommended at this time, holding a DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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Referenced Stocks: GRMN

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