Garmin Ltd. (GRMN): A Dividend-Paying Tech Stock Gets New Life

The mobile companies causing issues for Garmin include Apple Inc. (NASDAQ:AAPL) and Google Inc (NASDAQ:GOOG). These mobile phone makers already offer built-in GPS services. Apple has managed to miss earnings estimates each of the last two quarters. Even with the misses, the tech giant is still a major growth story. Apple is gaining market share in the mobile sector, but Google’s Android devices still leads the market (see what this Google exec thinks of the “Mobile Battle.”)

Google, meanwhile, is one of the leading search companies out there, with 3Q results also missing consensus. Latest weakness was a result of continued losses in its recently acquired Motorola Mobility segment. Both of these tech giants still appear to offer investors significant growth opportunities given their diverse product portfolios; Google has a long-term expected earnings growth rate of 13.5%, while Apple’s estimates range from 20-25% annually. These two stocks are also on our list of tech stocks loved by hedge funds (see our entire Top Ten here).

For investors looking to play the ever-changing tech market, we believe there are other investment opportunities besides Garmin that are better-suited for robust growth. What we do like, though, is Garmin’s dividend payout and its growth initiatives, which will be key in supporting income investors going forward. Garmin has solid exposure to the auto markets, and will have a number of new investors given its addition to the S&P 500 Index. Although we see little room for multiples expansion given the infringement of GPS-powered mobile phones on Garmin’s market share – even though it did spend 11% of revenues on R&D in 2011 – we do like Garmin’s ability to generate cash and return it to shareholders.

To continue reading about how insiders have been trading the company, check out this article, and to learn more about Garmin’s stock in its entirety, check out its profile page on Insider Monkey.