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Garmin share price takes a dive – Apple related?

Garmin share price takes a dive – Apple related?

 

Garmin’s share price has today taken a 2% tumble. Not huge in the grand scheme of things but the relative fall compared to the NASDAQ is even greater than 2%. So we should not dismiss this as an ‘insignificant’ event.

I have just reported that Apple is now more widely thought to be planning a competitor to the  Fenix 6 / Fenix 7  with a Series 8 Watch purported to be planned for 2022. That Series 8 watch is thought to specifically include a variant that is intended for a more rugged environment. ie a competitor to watches designed for an active OUTDOORS lifestyle as typified by Casio and Garmin products.

Garmin’s Fenix range is one of the biggest earners of bottom-line dollars for the company and I have frequently said on this blog that broad competition by Apple is much closer to hand than many people assume. Whilst an Apple Watch will never be able to meet the rigours of a week-long wilderness adventure or take you up beyond Everest base camp, the VAST majority of the millions who buy a Fenix, buy them for pseudo-lifestyle reasons. The worry is that people who like to buy a Fenix might instead choose to like to buy an Apple. Bang goes 80% of the Fenix sales.

This is probably bigger news than you think…

 

 

 

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13 thoughts on “Garmin share price takes a dive – Apple related?”

      1. True. Though the full effect of supply chain issues is still on going. I’m just guessing of course.

        BBC news had an article “Disruption to shipping could delay Christmas orders” only a few days ago.

      2. the ‘market’ tends to know about things WAY before anyone else does. So this supply chain stuff will have been factored in a while back. Supply chain issues would affect similar companies broadly equally ie the market
        however the tech index (NASDAQ) is rising.
        so the issue that caused garmin’s mini fall probably was garmin-specific.
        could have been this or something else.

      3. To be fair Apple is one of the biggest companies in the world and one of the biggest chip purchasers at TSMC . They were the first to have access to 5nm process (believe they are still the only one shipping 5nm parts) and will have 3nm production this year. AMD is only now just moving to 5nm for parts due later this year. The amount of wafer starts Apple purchases for iphone , macs , ipads , apple watches absolutely dwarfs what garmin purchases. So at the end of the day Apple will be more insulated from shortages than the smaller companies.

        Also I believe its only a matter of time before fitbit and other companies bring up anti trust claims against apple for the features they keep locked away from rival watch makers. The EU Spotify case and Epic vs apple in the states will either let loose all hell upon Apple or most likely cause the biggest monopoly of this century.

  2. I don’t know, dude. Could be simply stochastic movement. GRMN is up ~150% over the past year and today’s price is the same as last Friday.

    This is why I buy index funds.

    I googled for some revenue stats. Garmin had $4.19b in revenue in 2020. Polar Electro is about $193m. Suunto is about $19m. Coros $7m.

    Garmin is in a totally different league from the other sports electronics companies. If Garmin is in danger of losing its market to Apple, shouldn’t these others wiped out first?

  3. a price rise or fall is not necessarily relevant. that is why i showed two charts. one for garmin and one for the market. a fall against a rising market is not random.

    you are wise to buy index funds. There is no way for you or a fund manager to consistently beat the risk/reward curve without insider knowledge which, of course, is illegal to act on.

    of course timing and your choice of index are also important

  4. The Nasdaq price that you show is the ticker NDAQ, which is the symbol for the company Nasdaq , Inc., which is a capital markets exchange business that operates that Nasdaq exchange (amongst others) and publishes the Nasdaq index.

    You want the Nasdaq 100 or the Nasdaq Composite Index, which can be found with the tickers NDX or IXIC, respectively 😀

  5. I think that the ‘show stopper’ for Apple is not ‘functionality’ related, but has to do with the battery. The fact that you need to charge the AppleWatch on a dialy basis makes it less attractive as a sports watch – mainly for long hours types of sports. When they solve this issue – Garmin is indeed going to feel the affect.

    1. i don’t think the issue can be ‘solved’.
      battery will get a tad better, lo res screens use less power and there are components that can also use less power.
      those factors have to be compromised with as the tech evolves
      there are also soft factors like a growing realisation that people don’t need an athletic watch for their basic fitness needs.
      perhaps also hardware design issues eg buttons, that might convince some people to use AW if the AW had more of them them

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