aitraders

Where is Garmin Leading Us?

Something appears to not correlate. Judging from the supply chart, they were reducing inventory levels from March to June '07, and sales increased in the following quarters to record levels. In addition, they corrected inventories astutely in '05 and '06, trending down for lower growth quarters and stocking up for growth, which is a positive sign of efficient inventory management. However, looking at '07, it appears that not even they know how strong growth is giong to be, evidenced by earnings surprises over last several quarters. Therefore, although the supply line may indicate they expect slower growth in conservate inventory management, the charts also indicate demand exceeding expectations. Conservative and efficient inventory management with increasing demand is one of the structural reasons this company will succeed.