Manufacturer of GPS enabled devices Garmin (NYSE: GRMN ) Let investors know the business is growing. Its fourth-quarter financial update and 2026 guidance helped the stock soar 25.4% in February, according to data provided by S&P Global Market Intelligence.
Even beyond 2025, which will make for tough comparisons this year, management is still predicting 9% growth. Investors can look at a history of conservative forecasts and conclude that double-digit growth is likely again this year, making Garmin stock a strong buy.
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Garmin’s fitness segment has grown to become one of the largest. After growing 42% year-over-year in Q4, the category has grown an average of 32% per quarter over the past two years. Garmin Fitness products include only smartwatches and other devices for running, cycling, golf and other sports. It offers new features in digital health and fitness. The company has enhanced its premium Connect+ offering with AI-powered nutrition tracking and visualizations to help users achieve nutrition and fitness goals.
Fitness isn’t the only area where Garmin is growing. The company posted record revenue in all five segments last year, with aviation and marine also posting double-digit growth in the fourth quarter. For the full year, Garmin’s revenue increased 15%, nearly double the 8% growth management had originally forecast.
This is more of a pattern than an anomaly. 2024 revenue growth of 20% follows the company’s initial estimate of 10% growth over 2023. Investors should factor management’s historically conservative guidance into their decision as to whether a stock is a good value. This helps explain why the stock went up last month.
Guidance for 9% revenue growth and slightly higher earnings per share (EPS) growth gives management confidence to improve returns to shareholders as well. It proposed to raise its quarterly dividend from $0.90 to $1.05 per share. This is a 17% increase.
The company itself thinks its stock is still a good buy. Garmin launched a new $500 million share repurchase plan. This replaces the previous $300 million plan, which left only $56 million.
There is no dearth of cash to make friendly moves for both partners. Garmin generated $1.36 billion in free cash flow in 2025 and ended the year with approximately $4.1 billion in cash and marketable securities. Without debt on the balance sheet, investors should consider this financial strength when studying valuation.
