Why is Garmin stock skyrocketing on Wednesday? – Garmin (NYSE:GRMN)

Garmin Ltd reported 24% revenue growth in the third quarter of 2024, beating analyst estimates. Earnings per share of $1.99 also beat expectations. The stock rose after the earnings report.

Garmin Ltd GRMN reported fiscal third-quarter 2024 revenue growth of 24% year-over-year to $1.59 billion, beating analysts' consensus estimate of $1.44 billion.

The GPS navigation and wearable technology company's pro forma EPS of $1.99 beat the analyst consensus estimate of $1.44. Stock rose after the print.

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Segments: Fitness revenue increased 31% year-over-year to $463.89 million, led by growth in wearables.

Outdoor sales increased 21% year-over-year to $526.55 million, primarily driven by growth in adventure watches. Aviation revenue increased 3% year-over-year to $204.63 million, driven by aftermarket product categories.

Marine revenue increased 22% year over year to $222.24 million due to contributions from the JL Audio acquisition. Auto OEM grew 53% year-over-year to $168.71 million, driven primarily by growth in domain controllers.

Gross margin increased 300 basis points to 60.0% and operating margin increased to 27.6% from 21.2% a year ago.

Garmin generated free cash flow of $219.41 million in the quarter, compared to $311.88 million a year ago. As of September 28, 2024, the company had cash and equivalents of $2.42 billion.

“We are increasing our 2024 outlook based on the results achieved to date and the momentum we are experiencing as we enter the important holiday selling season,” said Cliff Pemble, President and Chief Executive Officer of Garmin Ltd.

Outlook for FY24: Garmin expects revenue of $6.12 billion (up from $5.95 billion) versus the consensus of $5.99 billion. Pro forma EPS is expected to be $6.85 (previously $6.00), versus consensus of $6.08.

Garmin shares have gained over 31% since the beginning of the year.

Price promotion: At last check on Wednesday, GRMN shares were up 14.01% in premarket trading at $189.50.

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