Better Tech Accessory Play: ZAGG vs. Skullcandy

The following video is part of our "Motley Fool Conversations" series, in which consumer goods editor and analyst Austin Smith and technology and media editor and analyst Andrew Tonner discuss topics across the investing world.

In today's edition, Andrew and Austin talk about a creative way to play the mobile revolution: accessories. So many investors have looked to component plays as the one-off way to profit from big mobile growth that they seem to have overlooked this potential avenue. Two of the most compelling plays are Skullcandy (NAS: SKUL) and ZAGG (NAS: ZAGG) . As many people begin using their mobile devices as portable media stations, they are invariably drawn to pick up a hip pair of self-expressive headphones to get full use from them. While Apple's (NAS: AAPL) ever-popular iPhone comes with headphones, that hasn't seemed to hurt Skullcandy, which grew sales 45% from last year. Then there is ZAGG, which sells cases for mobile devices, including the whole suite of iGadgets. While they don't have the same brand strength as Skullcandy, their products are a more common mobile device accessory than flashy headphones.

These companies are just two ways to profit from Apple's continued growth. There are the component plays I mentioned earlier, which you can read about in our report "The Next Trillion Dollar Revolution," which details a hidden component play inside mobile phones that also is a market leader in the exploding Chinese market. Inside the report, we not only describe why the mobile revolution will dwarf any other technology revolution seen before it, but we also name the company at the forefront of the trend. Hundreds of thousands have requested access to previous reports, and you can access this new report today by clicking here -- it's free.

At the time this article was published Andrew Tonner has no positions in the stocks mentioned above. Austin Smith has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Skullcandy Inc. Motley Fool newsletter services recommend Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.


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Dan Plesse

I agree with Josh Sorensen below. iFrogz is more like Skullcandy then ZAGG. Notice they don't print or say ZAGG's growth rate or any numbers what-so-ever. Why because it would hurt their short side argument. So hide the numbers, talk up the shorts interest and talk down the branding. ZAGG Inc. will reports First Quarter 2012 Financial Results around May 10, 2012, In 30 days!

April 13 2012 at 5:31 PM Report abuse rate up rate down Reply
Josh Sorensen

"ZAGG has no branding...", "iFrogz is essentially the same product that they themselves make"...

You really need to do some more research before you make claims like that. ZAGG's invisibleSHIELD (sometimes called invisi-shield) has created a category. They are the market leader in screen protection. They have great branding. Also, iFrogz sells primarily cases and audio. How is that "essentially the same product that they themselves make"?

If you go in to any of the major carriers, Best Buy, Radio Shack, etc. and ask them which brand in the best screen protector the majority of the time they will say ZAGG. Ask the same question about Headphones or audio and I guarantee you won't get the same result with Skullcandy.

Distribution is a huge factor as well, and ZAGG excels in this category too...

April 13 2012 at 4:56 PM Report abuse rate up rate down Reply