2 navigation titles that continue to point in the right direction

GPS navigation with global positioning was once only available through standalone GPS devices. Many analysts believe the widespread penetration of smartphone-based GPS navigation apps into the computer and technology industry is similar Alphabet Inc. NASDAQ:GOOGL owned Google Maps and Waze, The Apple company. NASDAQ:AAPL Apple-owned maps and MapQuest would surely spell the death of GPS devices. In the same way that Netflix ushered in the dawn of streaming entertainment and the death of Blockbuster Video, it was expected that smartphone navigation apps would end the need for portable navigation devices. But is not so. Here are 2 types of GPS navigation that are still thriving and continue to defy gravity.

Garmin

Garmin Ltd., based in Switzerland NYSE: GRMN was one of the pioneers of GPS navigation devices. The company has expanded its range of wireless devices to include fitness and smartwatches in its portfolio of outdoor portable GPS devices. Garmin has tried to specialize its products for specific user groups who require a rugged, waterproof, high-precision portable navigation device that has advanced features and can be used offline. Specialization was the key to success. Garmin products are an industry mainstay by providing these attributes in products that can be used in applications such as fitness tracking, aviation, automotive and marine navigation.

Constant growth

Garmin reported fourth-quarter 2023 EPS of $1.72, beating analysts’ estimates by 32 cents. Revenue rose 13.3% year over year to $1.48 billion, beating consensus analyst estimates of $1.41 billion. Gross margins grew 130 basis points to 58.3% compared to 57% in the year-ago period. Operating margins improved to 23% compared to 20% in the year-ago period.

For full-year 2023, the company reported record revenues of $5.23 billion, up 8% year-over-year. Its Aviation, Marine and Auto OEM segments posted record full-year revenues. The Company announced a $300 million stock repurchase program effective through December 26, 2026. The Board of Directors has authorized a dividend of $3.00 per share paid in four quarterly installments with dates to be determined by the Board.

Growth by segment

Its fitness segment recorded 22% year-over-year growth in the fourth quarter of 2023, driven by strong demand for wearables. The outdoor segment saw revenues increase 8% year-over-year, led by adventure watches. It has expanded its diving offering with the launch of the Descent G1 Solar-Ocean Edition, made from recycled plastic from the ocean. The aviation segment declined 4%. Marine segment revenues increased 14% year over year thanks to the contribution from the acquisition of JL Audio. Garmin has launched the ECHOMAP Ultra 2 series of chartplotters with premium sonar, mapping and wireless networking capabilities for inshore and inshore anglers. Its automotive OEM segment saw a 54% increase in revenue as it shipped infotainment and instrument cluster domain controllers to the BMW Group. These control various features of the car, from navigation to audio, Bluetooth connectivity and smartphone integration. Check the heat map of the sector on MarketBeat.

Acknowledgments

Garmin received 6 Innovation Awards at the 2024 Consumer Electronics Show for Venu 3, Epix Pro, MARQ Golfer-Carbon Edition and Garmin’s Autoland retrofit. Eve Air Mobility has selected the G3000 integrated flight deck for its electric vertical take-off and landing (EVTOL) aircraft.

Force Kraken was selected for a Marine Power Innovation Award by Boating Magazine. Garmin ranked first in the top 20^th consecutive year in the 2024 Avionics Manufacturing Product Support Survey conducted by Professional Pilot.

Mixed guidance for the full year 2024

Garmin expects full-year EPS of $5.40 to consensus estimates of $5.56. Full-year 2024 revenues are expected to be approximately $5.75 billion versus consensus estimates of $5.56 billion.

That’s why Garmin portable devices are still around after 20 years

Garmin CEO Clifton Pemble commented, “For more than two decades, our eTrex series of handhelds has been an essential product for outdoor adventures. We recently launched eTrex Solar, our first portable GPS with solar charging.”

Pemble continued: “This new portable device can run indefinitely using only energy harvested from the sun, which is a game-changer for hikers, explorers and off-the-grid adventurers. Looking ahead, we expect our strong roadmap of Outdoor products will result in revenue growth of 7% for the year.”

Garmin analyst ratings and price targets I’m on MarketBeat. Shares of Garmin’s peers and competitors can be found with MarketBeat Stock Screener.

Daily Bull Flag Escape

The daily candlestick chart on GRMN illustrates a bullish flag breakout pattern. The flagpole formed at $99.04 on October 27, 2023. The stock rose on the daily market structure (MSL) low, triggering a breakout to $101.10 in its third-quarter earnings report 2023. Surprisingly, the stock continued to rise in steady increments to $128.89, where it peaked and began to flag as the stock retreated making lower highs and lower lows in a parallel channel. The bull flag breakout occurs on the release of Q4 2023 earnings, with shares gapping to $128.89 and peaking at $137.87. The daily relative strength index (RSI) has risen above the 70 band. Pullback support levels are at $128.89, $123.46, $113.83, and $105.88.

Trimble

While Garmin products are aimed at consumers and recreational users, Trimble Inc. NASDAQ: TRMB is aimed at professional and corporate customers. Their products and services as hardware and software companies are used in various industries, from agriculture, construction, infrastructure and transportation to natural resources, geospatial, utilities and government. Their products go beyond GPS navigation. Therefore, in 2016 the company name was changed to Trimble from Trimble Navigation.

Industrial technology

Trimble sees itself as an industrial technology company that helps you get jobs done more efficiently, precisely and accurately. Its products are focused on improving workflows. Their products are used to collect data and administer analytics to create solutions. They have mixed, augmented and extended reality technology to visualize the physical environment using holographic data suitable for the construction industry. The company is also riding the wave of digital transformation by migrating to a subscription model for its software solutions.

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Thrive more than survive

On February 12, 2024, Trimble reported fourth-quarter 2023 earnings per share of 63 cents, beating consensus estimates by 3 cents. GAAP net income was $64 million, while non-GAAP net income was $156.6 million. Adjusted EBITDA was $241.2 million and represented 25.9% of revenues. Revenue grew 8.9% year-over-year to $932.4 million, beating consensus estimates of $910.11 million. Trimble achieved record annualized recurring revenue (ARR) growth of 24% to $1.98 billion. At the end of the year, gross margins increased by 470 bps to 64.7%. This compares to 58% five years ago.

Guide lowered

Trimble lowered its first-quarter 2024 EPS to 62 cents from 57 cents versus a consensus analyst estimate of 67 cents. Revenue expectations came in lower at $905-935 million versus consensus estimates of $981.73 million. Full-year 2024 EPS is expected to be between $2.60 and $2.80 versus $2.69, according to consensus estimates. Full-year 2024 revenues are expected to be in the range of $3.57 billion to $3.67 billion versus consensus estimates of $3.83 billion.

Trimble CEO Rob Painter commented: “Geographically speaking, North America has been healthy overall. Europe remains quite challenged. Agriculture and transportation markets are facing macro headwinds due to commodity prices and overcapacity in the trucking industry. The engineering and construction markets proved to be more resilient, with puts and takes across all sub-segments.” Painter concluded: “Controlling what we control is the ongoing operational theme.”

Trimble analyst ratings and price targets I’m on MarketBeat.

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