Garmin Ltd. (GRMN)
Valuation Overview•Is Garmin Ltd. Overvalued or Undervalued?
Trading at a relative discount to industry peers, suggesting a specific risk premium is applied.
High-quality fundamentals with a strong composite quality score of 84/100, backed by robust profitability and solvency.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: High-quality compounder, with profitability as the only relative weakness.
Wall Street is highly bullish, projecting significant upside with steady expected earnings growth. However, capital return yields remain modest, anchored by a strong, well-covered dividend yield.
GRMN demonstrates strong business quality with robust profitability and healthy margins (highlighted by a massive 22.0% ROIC). This is backed by a fortress balance sheet, holding significant net cash ($2.1B) and minimal debt risk.
The company demonstrates solid revenue growth (14.2% 3Y CAGR) paired with robust earnings compounding (19.5% EPS 3Y CAGR). This growth is supported by elite operational efficiency, sustaining an impressive 26.5% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $1.8B | +15.1% | +14.2% | +11.6% | +9.9% | |
| EBITDA | $480.8M | — | +20.1% | — | — | |
| Net Income | $405.1M | +17.9% | +19.6% | — | +13.8% | |
| EPS (Diluted) | $2.09 | +17.7% | +19.5% | +10.7% | +13.6% | |
| Free Cash Flow | $469.4M | +10.0% | +36.0% | +7.5% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 59.1% | 58.3% | 58.1% | 58.2% |
| Operating Margin | 26.5% | 24.0% | 23.5% | 23.4% |
| Net Margin | 23.3% | 23.3% | 22.4% | 22.1% |
| FCF Margin | 19.4% | 20.4% | 17.3% | 18.4% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $1.84 | $2.08 | +13.0% | ||
| Q1'26 | $2.40 | $2.79 | +16.3% | ||
| Q4'25 | $1.99 | $1.99 | +0.0% | ||
| Q3'25 | $1.90 | $2.17 | +14.2% | ||
| Q2'25 | $1.67 | $1.61 | -3.6% | ||
| Q1'25 | $1.90 | $2.41 | +26.8% | ||
| Q4'24 | $1.44 | $1.99 | +38.2% | ||
| Q3'24 | $1.44 | $1.58 | +9.7% |
Total return is +20.0% (1Y), lagging the benchmark by -5.0%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +16.7% | +7.3% | — |
| 1Y | +20.0% | -5.0% | +1.9% |
| 3YCAGR | +32.3% | +12.3% | +9.3% |
| 5YCAGR | +12.3% | -0.6% | +11.1% |
| 10YCAGR | +19.9% | +6.3% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Garmin Ltd. (GRMN) valuation, health, and returns.
Garmin Ltd. is estimated to be fair under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. trading near fair value (DCF: $187.86)
Garmin Ltd. has multiple valuation anchors: DCF Intrinsic Value: $187.86 | Peer Relative Fair Value: $366.13 | Wall Street Analyst Target: $270.67 (implying +15.6% upside). A convergence of these signals offers higher conviction.
Garmin Ltd. displays excellent financial health with a composite quality score of 84/100, supported by a Altman Z-Score of 16.0 (safe zone), Piotroski F-Score of 7/9, Return on Invested Capital (ROIC) of 22.0%.
Garmin Ltd. pays a 1.5% dividend yield, covered by a 40% payout ratio with 8 years of growth, supplemented by a 0.5% buyback yield.
Garmin Ltd.'s current growth trajectory is Stable. The company achieved +15.1% 1Y revenue growth and +17.7% 1Y EPS growth, compared to its 3Y revenue CAGR of +14.2%.
Wall Street consensus is Hold based on 28 analysts, beating EPS expectations in 83% of recent quarters with a 2-quarter streak. The consensus price target represents a +15.6% change from current levels.
Investment risks for Garmin Ltd. include: -28.0% 1-year max drawdown. Volatility risk is characterized by a beta of 1.27x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.