Garmin Shrs Falling As GPS Device Prices Crumble

Garmin (GRMN) shares are under pressure on concerns about rampant discounting of GPS devices. Analysts at both Wedbush Morgan and Deutsche Bank today expressed concerned about the trend, bringing down their target price for the stock. Wedbush Morgan’s Scott Sutherland cut his target on the stock to $19, from $26. He cut his 2008 EPS estimate to $3.63, from $3.72; for 2009, he goes to $3.14, from $3.52. The estimate cuts, he writes, reflect “a weakening consumer, likely leaner channel inventory, and channel checks.” He says checks at some Southern California retailers over the weekend found good demand for personal navigation devices priced under $200, with some under $100. He notes that GRMN trades at just 5x 2009 non-GAAP EPS estimates, but that pricing trends and a shifting competitive landscape “gives us pause.” He maintains a Hold rating. Deutsche Bank’s Jonathan Goldberg cut his target to $14, from $18. He also cut his target on rival TomTom ... (link)