I bought 30 shares of Garmin (GRMN) on August 16th at $88.82. Last Friday GRMN closed at $119.40 and I was sitting on a 34% profit. Oink Oink.
I got a rude awakening this morning when I saw the stock trading near $102, down almost 15%! Nokia bought Navteq, Garmin’s map data supplier, for about 8 billion dollars and some change. The stock also got downgraded by CIBC this morning. Luckily, GRMN found support at its 50-day moving average about a half hour into trading this morning. It is currently bouncing some, trading near $108, but the 20-day MA seems to be acting as resistance. It will be interesting to see where GRMN closes today.
When I first witnessed the carnage this morning, I was in panic mode and almost sold at $103. Luckily I kept my wits – It would have been a better idea to buy at $103, as you would now be up about 5%. I’m going to see how the stock performs going into the close today before I decide what to do.
This news raises some questions: can Garmin maintain its growth in the personal navigation device market with this increasing competition? Is the stock getting ahead of itself (up 92% this year)? Will GPS capable cell phones begin to take market share from Garmin? Apple could release a GPS device, or add GPS to the iPhone. Check out the article below by Marshall Brain.
Apple about to blow us away with a palmtop? | Marshall Brain
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