Garmin's (GRMN) Mounting Inventories + Slow Demand = Lower Prices and Profits: Deutsche Bank
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Deutsche Bank comments on Garmin (Nasdaq: GRMN), saying inventories are mounting and Q2 demand may not materialize. The firm said in Q1 the company had a 34% sequential increase in inventories, which the company attributed to seasonal stocking ahead of the Q2 shopping season, but they said despite this claim, Garmin's historical pattern has seen flat Q1 inventory levels.
The firm said their checks indicate that this year's Q2 shopping season (Dads and Grads) is unlikely to produce a significant surge in demand, which will leave excess inventory and put pressure on prices.
The firm thinks Garmin will have to back off their full-year guidance when they announce Q2 numbers.
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