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No. of Recommendations: 3

Highlights for the fourth quarter 2017 include:
? Total revenue of $888 million, growing 3% over the prior year quarter, with outdoor, fitness,
marine and aviation collectively growing 9% over the prior year quarter and contributing 78% of
total revenue
? Gross margin improved to 56.2% compared to 54.7% in the prior year quarter
? Operating margin improved to 20.2% compared to 18.6% in the prior year quarter
? Operating income of $179 million, representing growth of 12%  
? GAAP EPS was $0.73, for the fourth quarter, representing growth of 2% and pro forma EPS(1) was
$0.79 for fourth quarter 2017, representing growth of 9%
? Delivered our one-millionth certified aviation product demonstrating our long history of
innovation and contribution to the aviation industry
? Began shipping our updated marine ECHOMAPTM and STRIKER TM products bringing connectivity
to the water...

Here are the segment revenue growth stats going back 2 years:

Segment Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417
Fitness 31% 5% 23% 14% 9% 34% 32% 20% -3% -15% -12% 1%
Outdoor -10% 4% -5% 6% 33% 23% 28% 46% 20% 46% 31% 16%
Aviation2% 5% -5% 12% 8% 6% 14% 13% 16% 15% 16% 11%
Marine 7% 41% 0% 8% 29% 8% 12% 19% 26% -3% 10% 24%
Auto -11% -15% -14% -21% -11% -18% -21% -17% -19% -15% -12% -14%

Another beat and strong report. Non-auto now accounting for 78% of revenues for the quarter, and 76% for the year. FYI, that compares to 63% for full year 2015. Obviously, the decline in PND is part of that, but since revenue has continued to grow the whole time, it more obviously speaks to the growth in the other segments. And thus, why I continue to own it this whole time. 2015 total revs was $2.82B, compared to 2017 at $3.087B, and predicted to grow to $3.2B for 2018. And just to put the $3.2B estimate into perspective, they started 2017 with an estimate of $3.02B, and gradually moved it up as the year progressed. So they surpassed their initial estimate by a bit more than 2%. 2018 estimates come to a revenue growth number of 3.7%. So beating that would be nice. I know these aren't huge growth numbers, but they pay a greater than 3% dividend, are holding $2.3B on the balance sheet with no debt, and generate a huge amount of cash flow. I continue to think that at some point that cash/cash flow position will provide a nice bump for shareholders, either in the form of direct payments/buybacks or growth creating acquisitions. Q4 cash flow was $144M, while dividends only paid out $96M. The 4% dividend increase they now propose still leaves lots of cash flowing onto the balance sheet. I mentioned last quarter that a dividend raise wouldn't surprise me. I'm actually a bit surprised that it isn't higher, considering the cash position. But I trust this management with capital allocation. They have grown margins, spent wisely on R&D and also selectively advertising.

I look at this as a fairly low-medium risk holding which should grow in the 7% range annually - sales growth of 3+ and dividend of 3+, with a bit of a call option from the balance sheet and cash flow generation.

Long GRMN. See profile for holdings.
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