Bounty Hunter 14 (Source)

Tracking Droids = what is the maximum number of updates you can get from your tracking droid Tracking Droid Effectiveness = what is the chance of your droid giving you another update Droid Precision = chance to avoid being eaten Droid Speed = Speed of droid when Find is used Droid Tracking Speed = Speed of droid when Track is used

So whether the droid actual manage to report back where you target is currently is, is determined by Tracking Droids and Tracking Droid Effectiveness skills together. Tracking Droids is just the upper possible cap.