Garmin Ltd. (NASDAQ: GRMN) stock is falling after GPS chipmaker SiRF Technology Holdings (NASADQ: SIRF) cut its first-quarter revenue forecast due to lower-than-expected demand in a weakened economic environment. This is bad news for GRMN, since it implies lower sales for it as well. GRMN is also under pressure from news that consumer confidence sank to a five-year low in March. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on GRMN.

After hitting a one-year low of $52.18 in April, the stock hit a one-year high of $125.68 in October. This morning, GRMN opened at $59.49. So far today the stock has hit a low of $57.70 and a high of $59.97. As of 12:15, GRMN is trading at $59.78, down $2.60 (-4.2%). The chart for GRMN looks bearish but deteriorating, while S&P gives the stock its highest 5 STARS (out of 5) strong buy rating.

For a bearish hedged play on this stock, I would consider a May bear-call credit spread above the $75 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in two months as long as GRMN is below $75 at May expiration. Garmin would have to rise by more than 24% before we would start to lose money.

Garmin Ltd. (NASDAQ: GRMN) stock is falling lower today on news that SiRF Technology (NASDAQ: SIRF), whose chips are used in GRMN's personal navigation devices, reported a fourth-quarter profit that missed analyst expectations. SIRF earned 8 cents a share excluding one-time items in the quarter, well below analyst estimates of 32 cents a share. SIRF blamed a seasonal decline in demand for the disappointing profit, which could be a bad sign for GRMN. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on GRMN.

After hitting a one-year low of $50.01 in March, the stock hit a one-year high of $125.68 in October. This morning, GRMN opened at $65.96. So far today the stock has hit a low of $64.26 and a high of $66.23. As of 11:00, GRMN is trading at $65.00, down $4.66 (-6.7%). The chart for GRMN looks bearish but improving slightly, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.

MOST NOTEWORTHY: Yahoo!, Goldman Sachs and Bankrate were today's noteworthy downgrades:

• Banc of America downgraded shares of Yahoo! (NASDAQ: YHOO) to Neutral from Buy as they believe that even if shareholders accept Microsoft's (NASDAQ: MSFT) offer, the regulatory hurdles are significant.
• Oppenheimer downgraded shares of Goldman Sachs (NYSE: GS) to Perform from Outperform as they believe the current valuation is not sustainable in a year when the company will probably deliver results that will not be substantially better than peers.
• Jefferies lowered its rating on Bankrate (NASDAQ: RATE) to Hold from Buy on valuation, as they believe the run-up in shares reflects expectations for strong Q4 results and guidance.

OTHER DOWNGRADES:

• SiRF Technology (NASDAQ: SIRF) was downgraded to Hold from Buy at Jefferies, to Market Weight from Overweight at Thomas Weisel and to Perform from Outperform at Oppenheimer.
• Goldman downgraded Posco (NYSE: PKX) to Sell from Neutral.
• Baird downgraded Associated Bancorp (NASDAQ: ASBC) to Neutral from Buy.

MOST NOTEWORTHY: Gander Mountain, Lev Pharmaceuticals, Intermune, Aetna and Medco Health were today's noteworthy initiations:

• Nollenberger initiated shares of Gander Mountain Company (NASDAQ: GMTN) with a Sell rating and $5.00 target, and believes the company's goal of reaching profitability in 2007 could prove overly optimistic.
  
• Lev Pharmaceuticals (OTC: LEVP) was initiated with a Sector Outperformer rating and $3 target at CIBC, as the firm believes Cinryze will likely be approved in 1Q08 and they expect the company to have significant pricing leverage.
  
• JP Morgan resumed coverage of Intermune Inc (NASDAQ: ITMN) with an Overweight rating and expects shares to be driven by the company's pipeline in IPF and HCV.
  
• Aetna Incorporated (NYSE: AET) was initiated with an Outperform rating at Wachovia. The firm feels Aetna is positioned for better growth and higher quality earnings than its peers.
  
• William Blair started shares of Medco Health Solutions Inc (NYSE: MHS) with an Outperform rating, as they believe an aging population, rising health care costs, and an acceleration in new product introductions should increase demand for PBM services over the next five years.

OTHER INITIATIONS:

• ABN Amro started shares of Siliconware Precision Industries Company Ltd (NASDAQ: SPIL) and Advanced Semiconductor Engineering Inc (NYSE: ASX) with Buy ratings.
  
• Goldman initiated Silicon Image Inc (NASDAQ: SIMG) with a Sell rating and $4.50 target, and initiated Sigma Designs Inc (NASDAQ: SIGM) and SiRF Technology Holdings Inc (NASDAQ: SIRF) with Neutral ratings and a $43 target and $19 target, respectively.

According to the German magazine Focus and reported on MacRumors.com, Apple Inc (NASDAQ: AAPL) is reportedly looking at developing a car navigation and sound systems. The device, which would combine navigation, entertainment and communication in a single unit, would be introduced in 2009. Apple is said to be working with Mercedes, which may hold exclusive rights for six months once released. It is unclear if Apple will rely on Google Inc's (NASDAQ: GOOG) Google Maps for help with navigation.

Sources speculate that an Apple's device would be similar to ones already on the market. Apple has long been known to rise above its competitors. Some say the upcoming iPhone may clean up, so it may not be a stretch to say that a navigational device has the potential to do the same.

Who would be affected by a navigational device from Apple? Here's the competition:

• Garmin Limited (NASDAQ: GRMN): Garmin is a worldwide provider of navigation and information devices, many of which are enabled by global positioning system technology. Last week, Garmin International announced the nuvi 200W and the nuvi 250W, two new widescreen GPS navigators. With a 4.3-inch color touch screen display and a high-sensitivity internal GPS antenna, the question is, can it trump whatever Apple does?

• Trimble Navigation Limited (NASDAQ: TRMB): Trimble provides advanced positioning product solutions, typically to commercial and government users. Last month it received an $8.8M purchase order from the U.S. Marine Corps and signed an agreement with Cox Communications. How formidable a competitor would Apple be?

• SiRF Technology Holdings Inc (NASDAQ: SiRF): SiRF is a supplier of GPS semiconductor solutions, offering a wide-range of GPS chip sets and other products for high-volume markets. Earlier this month, the company announced SiRFDiRect technology, what they touted as a "navigation breakthrough." Could Apple steal their thunder?