Garmin Earnings: Demand for Premium Wearables Soars, and We Raise Our Forecast and Valuation

We are raising our fair value estimate for narrow-moat Garmin to $198 from $179 after the firm reported stellar fourth-quarter results that surpassed both our top-line and profitability expectations. Successful product launches and a cyclical upswing in demand propelled Garmin’s robust revenue growth during the quarter, while operational efficiencies and a favorable product mix buttressed margin. We have adjusted our intermediate estimates to reflect our reinforced faith in Gamin’s strong product portfolio, particularly in the fitness and outdoor segments. Management laid out 2025 targets that exceeded our top- and bottom-line expectations. Shares were up 14% intraday, leaving the stock moderately overvalued, in our view.