hardrookwar

Apple's $199 iPhone Is a Game-Changer

Yay, $200 phone subsidy! Wait, $480 data increase ($20/mo. over 24 month contract). ATT seems to be counting on the Total Moron factor to drive new iPhone sales. I guess no one went broke underestimating the American public, right?

Trading Garmin for a Bounce

Well, earnings announced today: up only 3% from Q1 2007. Sure sales are up, but if profit doesn't go up garmin is working harder and harder to make the same amount of money it made last year. This week's $600 government handouts to everyone might be used to buy a PND or two, but otherwise the housing market is in free-fall, consumer sentiment is as sour as it has ever been, and the economy has a long way to go before turning around. Q4 will provide the first news about the nuviphone, and Q1 next year will tell whether consumer confidence will turn with a new administration. It's going to be a long long time until then, and money in GRMN could probably be better invested elsewhere.

Trading Garmin for a Bounce

Er, I don't know about that, Slinger. The analysts and stock-buying public seem to think that PND's are the buggy whips of the turn of the century--obsolete. Only cell phones have penetrated every corner of the market (including africa, india, chine) and if LBS becomes indispensible there, cell phones will be how most people get their info, not PNDs.

So long as there is a boat, plane, or car without a GPS, there is room for GRMN to grow. But otherwise, in a world of real-time info, GRMN is the next Dell--they make the device; NVT makes the OS; ATT is the ISP; GOOG is the gateway to POI's; and the www provides the site-specific content. GRMN will probably never be at 120 again. See Dell's long term chart (post bubble) to see what GRMN future looks like. I'm long on GRMN but I'm bailing at 59-60 next year.

Garmin: Clearly Something's Not Right

Car sales are down, margins are down, direct competitors are warning, suppliers are warning, consumer confidence is way down, available credit and discretionary spending are shrinking, analysts are downgrading, prices in stores are visibly falling, and Garmin itself announced Q1 will be 40-50% of Q4. These are all a bunch of good reasons for the stock to fall. The last shoe to drop will be Garmin itself issuing a warning or just releasing those earnings on April 30.

But when that shoe drops on April 30, where will GRMN go? Even if it's bad news, the news seems to be factored in already. With a P/E of 12, $4+/sh. earnings(!), dividend of .75, lots of cash on hand, just how far can it really fall on bad news? 7x earnings? GRMN ain't Motorola, people! And good news (like a grab of TomTom's marketshare in europe, perhaps?) could send this stock up 10 pts in a day. A dropoff from Q4 is natural for consumer gadgets (only part of Garmin's business)--and what a Q4 it was, BTW, blowing away every estimate. Q1 08 will still crush Q1 07, yet downgrades may follow. Maybe Garmin pulls a stunt like increasing dividend, or buying back stock, to prevent erosion of share price. They should just keep making great devices. If the stock falls any further, Nokia ought to scoop 'em up. (Nokia won't have the map expense that Garmin has). Either way, the future is bright for LBS and GPS in particular. This is a global market from now on, so don't let US woes distract you from the long term value of GRMN going forward.

Garmin Hits New Lows, Despite Booming GPS Biz

How many times is the same news going to drive this stock down? Today it was a Tom Tom warning. Why would GRMN drop (again) after its CFO just gave a 40-50% of Q4 guidance, after Q4 news was blockbuster--albeit with clearly explained declining margins, after everyone sees Nokia buying NVT, after GRMN already stepped back from TeleAtlas bid? Come on! Anticipation of this brought it down from 124/sh. Dividend is still .75/sh, and earnings will be around 4.20/sh, making the current PE around 11. Ridiculous for a LBS stock in a burgeoning market. I'm long, but no way am I panicked. Where will GRMN be in 1, 2, 3, 5 years? Only the most dominant GPS player in the nascent LBS market. Let me tell you, my iPhone can't touch my Garmin 60cs and probably never will. Would someone loan me some cash so I can make a bundle in GRMN? I predict 80/sh by xmas. A GRMN in every car, GRMN software in 30% of phones, GRMN in every plane and boat.