Garmin Ltd. and Ouster, Inc. are two innovative players in the hardware and technology sector, each shaping the future of precision devices and sensors. Garmin, a well-established giant, offers diverse wireless navigation and fitness products, while Ouster pioneers cutting-edge digital lidar sensors for autonomous applications. This comparison explores their market positions and innovation strategies to help you decide which company presents the most compelling investment opportunity today.
Table of contents
Companies Overview
I will begin the comparison between Garmin and Ouster by providing an overview of these two companies and their main differences.
Garmin Overview
Garmin Ltd. designs, develops, manufactures, markets, and distributes wireless devices globally, focusing on fitness, outdoor, aviation, marine, and automotive markets. Founded in 1989 and based in Switzerland, Garmin operates in the technology sector with a broad product range including smartwatches, avionics, chartplotters, and infotainment systems. The company employs 21,800 people and trades on the NYSE with a market cap of $41.2B.
Ouster Overview
Ouster, Inc. specializes in high-resolution digital lidar sensors and software for 3D vision used in machinery, vehicles, robots, and infrastructure. Founded more recently and headquartered in San Francisco, Ouster operates in the technology sector with a smaller workforce of 292 employees. It trades on NASDAQ with a market cap of $1.63B, focusing on innovative lidar scanning and solid-state flash sensor technologies.
Key similarities and differences
Both Garmin and Ouster operate in the technology sector within the hardware and equipment industry, providing advanced technological solutions. Garmin has a diversified product portfolio across multiple market segments, while Ouster focuses specifically on lidar sensor technology for 3D vision applications. Garmin is a well-established global company with a large workforce and market cap, whereas Ouster is a smaller, more specialized firm with higher volatility as reflected in its beta.
Income Statement Comparison
The table below compares the key income statement metrics for Garmin Ltd. and Ouster, Inc. for the fiscal year 2024, highlighting differences in scale and profitability.
| Metric | Garmin Ltd. (GRMN) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Cap | 41.2B | 1.63B |
| Revenue | 6.30B | 111.1M |
| EBITDA | 1.77B | -79.9M |
| EBIT | 1.59B | -94.7M |
| Net Income | 1.41B | -97.0M |
| EPS | 7.35 | -2.08 |
| Fiscal Year | 2024 | 2024 |
Income Statement Interpretations
Garmin Ltd.
Garmin Ltd. demonstrated consistent revenue growth from 4.19B in 2020 to 6.30B in 2024, with net income rising from 992M to 1.41B. Margins remained strong, with a gross margin near 58.7% and an EBIT margin above 25%. In 2024, revenue growth accelerated by 20.44%, EBITDA expanded by 45.95%, though net margin slightly declined by 9.13%.
Ouster, Inc.
Ouster, Inc. showed rapid revenue growth from 19M in 2020 to 111M in 2024, with net losses narrowing from -107M to -97M. Gross margin improved to 36.42%, yet EBIT and net margins remained negative, at -85.22% and -87.35% respectively. The latest year saw a 33.41% revenue increase and significant improvements in net margin and EPS growth over 79%.
Which one has the stronger fundamentals?
Garmin Ltd. displays stronger fundamentals, with substantial revenue and net income growth, robust profitability margins, and positive EBITDA. Ouster, while growing quickly, continues to operate at significant losses and negative margins, indicating higher risk. Garmin’s stable earnings and favorable margin trends contrast with Ouster’s ongoing challenges in profitability.
Financial Ratios Comparison
Below is a comparison of key financial ratios for Garmin Ltd. (GRMN) and Ouster, Inc. (OUST) for the fiscal year 2024, providing insight into their operational efficiency, profitability, liquidity, and leverage.
| Ratios | Garmin Ltd. (GRMN) | Ouster, Inc. (OUST) |
|---|---|---|
| ROE | 17.98% | -53.64% |
| ROIC | 16.28% | -50.84% |
| P/E | 28.5 | -5.87 |
| P/B | 5.13 | 3.15 |
| Current Ratio | 3.54 | 2.80 |
| Quick Ratio | 2.56 | 2.59 |
| D/E (Debt to Equity) | 0.021 | 0.112 |
| Debt-to-Assets | 1.69% | 7.33% |
| Interest Coverage | 0 | -57.15 |
| Asset Turnover | 0.65 | 0.40 |
| Fixed Asset Turnover | 4.49 | 4.54 |
| Payout Ratio | 40.55% | 0% |
| Dividend Yield | 1.42% | 0% |
Interpretation of the Ratios
Garmin Ltd.
Garmin Ltd. shows strong profitability with a favorable net margin of 22.41% and a robust ROE of 17.98%, supported by a solid ROIC of 16.28%. However, valuation ratios such as a PE of 28.5 and PB of 5.13 appear stretched, and its current ratio at 3.54 is marked unfavorable, signaling potential liquidity concerns. Garmin pays dividends with a neutral yield of 1.42%, maintaining a balanced payout covered by free cash flow and manageable buyback activity.
Ouster, Inc.
Ouster, Inc. exhibits weak financial ratios, reflecting ongoing challenges with a negative net margin of -87.35% and a deeply negative ROE of -53.64%, alongside a high WACC of 17.47%. Despite a low PE ratio of -5.87, the company struggles with profitability and efficiency. Ouster does not pay dividends, focusing on reinvestment and growth, as indicated by high R&D expenses and no share buyback programs, consistent with its early-stage development phase.
Which one has the best ratios?
Garmin Ltd. clearly holds the advantage with a majority of favorable ratios reflecting profitability, efficient capital use, and financial health. Ouster’s ratios are predominantly unfavorable, highlighting significant losses and operational inefficiencies. Garmin’s stable dividend policy further contrasts with Ouster’s growth-focused reinvestment, making Garmin the financially stronger company based on the 2024 ratio analysis.
Strategic Positioning
This section compares the strategic positioning of Garmin Ltd. and Ouster, Inc., focusing on Market position, Key segments, and Exposure to technological disruption:
Garmin Ltd.
- Large market cap of 41B USD with diversified hardware products facing moderate competitive pressure.
- Diverse segments including Fitness (1.77B), Outdoor (1.96B), Marine (1.07B), Aviation (876M), and Automotive (610M).
- Exposure to disruption in digital and sensor technology, but with established product platforms.
Ouster, Inc.
- Small market cap of 1.6B USD, operating in a niche with high competitive pressure and volatility.
- Focused on high-resolution digital lidar sensors and software for 3D vision, generating 111M revenue.
- High exposure to technological disruption in lidar and sensor innovation, requiring continuous R&D.
Garmin Ltd. vs Ouster, Inc. Positioning
Garmin adopts a diversified approach across multiple consumer and industrial segments, providing revenue stability but facing broad market competition. Ouster concentrates on lidar technology with growth potential but carries higher risk due to limited segment diversification and smaller scale.
Which has the best competitive advantage?
Garmin demonstrates a favorable moat with consistent value creation and stable profitability. Ouster faces a slightly unfavorable moat, currently shedding value despite a growing return on invested capital trend, indicating less established competitive advantage.
Stock Comparison
The past 12 months have seen Garmin Ltd. (GRMN) and Ouster, Inc. (OUST) exhibit strong bullish trends overall, with notable price appreciations and differing recent momentum dynamics.
Trend Analysis
Garmin Ltd. posted a 57.86% price increase over the past year, showing an accelerating bullish trend with a high volatility of 29.55 and a peak price of 257.06. Recent months indicate a neutral short-term trend near flat at -0.01%.
Ouster, Inc. experienced a remarkable 404.84% price rise over the year, maintaining a bullish trend despite deceleration and lower volatility at 8.61. However, its recent trend reversed sharply with an 18.74% decline, signaling short-term weakness.
Comparing both, Ouster delivered the highest market performance over the year with a 404.84% gain versus Garmin’s 57.86%, though recent trading shows contrasting momentum between the two stocks.
Target Prices
Analysts present a clear consensus on target prices for both Garmin Ltd. and Ouster, Inc.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Garmin Ltd. | 310 | 193 | 237 |
| Ouster, Inc. | 39 | 33 | 36.67 |
The consensus target for Garmin Ltd. at 237 USD suggests upside potential from its current price of 213.93 USD. Ouster, Inc.’s target consensus of 36.67 USD significantly exceeds its current price of 27.11 USD, indicating strong growth expectations.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for Garmin Ltd. and Ouster, Inc.:
Rating Comparison
Garmin Ltd. Rating
- Rating: A-, indicating a very favorable overall rating.
- Discounted Cash Flow Score: 3, a moderate valuation indicator.
- ROE Score: 4, showing favorable efficiency in generating profit from equity.
- ROA Score: 5, very favorable asset utilization.
- Debt To Equity Score: 4, indicating favorable financial stability.
- Overall Score: 4, a favorable summary of financial health.
Ouster, Inc. Rating
- Rating: C-, reflecting a very unfavorable overall rating.
- Discounted Cash Flow Score: 1, very unfavorable valuation.
- ROE Score: 1, very unfavorable profit generation from equity.
- ROA Score: 1, very unfavorable asset utilization.
- Debt To Equity Score: 3, moderate financial risk profile.
- Overall Score: 1, a very unfavorable financial standing.
Which one is the best rated?
Based on the provided data, Garmin Ltd. is clearly better rated than Ouster, Inc., with higher scores across all financial metrics and a superior overall rating. Ouster’s scores indicate significant challenges in profitability and valuation.
Scores Comparison
Here is a comparison of the Altman Z-Score and Piotroski Score for Garmin Ltd. and Ouster, Inc.:
Garmin Ltd. Scores
- Altman Z-Score: 14.6, indicating a safe zone with very low bankruptcy risk.
- Piotroski Score: 5, reflecting average financial strength.
Ouster, Inc. Scores
- Altman Z-Score: 3.66, indicating a safe zone with low bankruptcy risk.
- Piotroski Score: 4, reflecting average financial strength.
Which company has the best scores?
Garmin Ltd. shows a significantly higher Altman Z-Score than Ouster, indicating stronger financial stability. Both companies have similar Piotroski Scores in the average range, with Garmin slightly ahead.
Grades Comparison
Here is a comparison of the recent grades assigned to Garmin Ltd. and Ouster, Inc. by reputable financial firms:
Garmin Ltd. Grades
This table summarizes Garmin’s recent grading updates from established financial institutions.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Tigress Financial | Maintain | Strong Buy | 2025-12-19 |
| Longbow Research | Upgrade | Buy | 2025-12-03 |
| Barclays | Maintain | Underweight | 2025-10-30 |
| Morgan Stanley | Maintain | Underweight | 2025-10-30 |
| Tigress Financial | Maintain | Strong Buy | 2025-09-30 |
| Morgan Stanley | Maintain | Underweight | 2025-09-19 |
| Morgan Stanley | Maintain | Underweight | 2025-07-31 |
| Barclays | Maintain | Underweight | 2025-07-31 |
| JP Morgan | Maintain | Neutral | 2025-07-17 |
| JP Morgan | Maintain | Neutral | 2025-05-01 |
Garmin’s grades show a mixed trend with strong buy ratings from Tigress Financial balanced by underweight ratings from Morgan Stanley and Barclays, while consensus remains largely neutral or hold.
Ouster, Inc. Grades
Below is an overview of Ouster’s recent grading activity by recognized financial firms.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Cantor Fitzgerald | Upgrade | Overweight | 2025-11-07 |
| Cantor Fitzgerald | Upgrade | Overweight | 2025-11-06 |
| WestPark Capital | Maintain | Buy | 2025-11-05 |
| Rosenblatt | Maintain | Buy | 2025-11-05 |
| WestPark Capital | Upgrade | Buy | 2025-08-13 |
| Oppenheimer | Maintain | Outperform | 2025-07-16 |
| WestPark Capital | Downgrade | Hold | 2025-06-12 |
| WestPark Capital | Upgrade | Buy | 2025-05-09 |
| Rosenblatt | Maintain | Buy | 2025-03-21 |
| Cantor Fitzgerald | Maintain | Overweight | 2025-03-21 |
Ouster’s grades predominantly show upgrades and buy or outperform ratings, indicating generally positive sentiment from analysts.
Which company has the best grades?
Ouster, Inc. has received consistently more positive grades with several buy and overweight ratings and no sell ratings. Garmin Ltd.’s ratings are more polarized, with strong buy and underweight ratings coexisting. This divergence may impact investor confidence differently, reflecting contrasting views on growth prospects and risk profiles.
Strengths and Weaknesses
Below is a comparison of key strengths and weaknesses for Garmin Ltd. (GRMN) and Ouster, Inc. (OUST) based on their latest financial and operational data.
| Criterion | Garmin Ltd. (GRMN) | Ouster, Inc. (OUST) |
|---|---|---|
| Diversification | Highly diversified with multiple segments: Automotive Mobile (610M), Fitness (1.77B), Outdoor (1.96B), Aviation (877M), Marine (1.07B) | Limited diversification, single main segment with 111M revenue |
| Profitability | Strong profitability: Net margin 22.41%, ROIC 16.28%, favorable overall financial ratios | Negative profitability: Net margin -87.35%, ROIC -50.84%, unfavorable ratios |
| Innovation | Steady innovation with stable ROIC trend and favorable competitive moat | Growing ROIC trend indicating improving innovation but still value destroying |
| Global presence | Established global presence with broad product range and markets | Smaller scale, emerging global footprint |
| Market Share | Solid market share in multiple industries, consistent revenue growth | Niche market player with lower total revenue and market penetration |
Key takeaways: Garmin exhibits a strong competitive position with diversified revenue streams and consistent profitability, making it a safer investment for risk-conscious investors. Ouster, while showing promising growth in profitability metrics, remains a riskier choice due to its current value destruction and limited scale.
Risk Analysis
Below is a summary table highlighting key risks for Garmin Ltd. and Ouster, Inc. based on the latest available data from 2024.
| Metric | Garmin Ltd. (GRMN) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Risk | Moderate (Beta 1.01) | High (Beta 2.94) |
| Debt level | Very Low (D/E 0.02) | Low (D/E 0.11) |
| Regulatory Risk | Moderate | Moderate |
| Operational Risk | Low (Stable operations) | High (Early-stage, scaling) |
| Environmental Risk | Moderate | Moderate |
| Geopolitical Risk | Moderate (Global sales) | Moderate (US-based) |
Garmin shows strong financial stability with very low debt and moderate market risk; its operational risks are lower due to established business segments. Ouster faces higher market and operational risks given its startup profile, negative margins, and higher volatility, making it more vulnerable to market downturns and execution challenges.
Which Stock to Choose?
Garmin Ltd. (GRMN) shows a favorable income evolution with strong revenue and profit growth over 2020-2024, supported by robust profitability ratios such as a 17.98% ROE and low debt levels. Its financial ratios and ratings remain largely favorable, despite some valuation concerns.
Ouster, Inc. (OUST) exhibits rapid revenue expansion and improving margins, but suffers from negative profitability metrics including a -53.64% ROE and elevated debt impact. Its financial ratios and rating are mostly unfavorable, reflecting an ongoing value destruction despite a growing ROIC trend.
For investors, Garmin’s consistent value creation and solid financial metrics might appear more suitable for those prioritizing stability and quality, while Ouster’s growth trajectory with improving profitability could be more appealing to risk-tolerant investors focusing on high-growth opportunities.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Garmin Ltd. and Ouster, Inc. to enhance your investment decisions:
