New Stock Report: Zagg (ZAGG.OB)
January 31st, 2009
No comments
Zagg Incorporated is a market leader of protective coverings for cell phones and hand-held devices under the brand name InvisibleSHIELD. The product consists of a thin, clear material that is virtually impenetrable to scratches, as it was first used to protect helicopter blades in the military. It’s most popular use is targeted towards the booming smart phone business and Zagg now offers more than 2,000 sku’s in order to meet demand for all different phone and electronic designs. Their distribution channels are rapidly increasing and include their online store (over 4 million unique visitors in 2008 vs. only 1 million in 2007) at zagg.com and other web retailers and affiliates including WalMart.com. The company is now entering into the big-box retail stores such as Best Buy and Carphone Warehouse, a large retailer in Europe. Best Buy started with only 3 sku’s in 300 stores in 2008 and is quickly expanding into several more sku’s including Zagg’s award winning Z-Buds (enhanced ear buds). In fact, the company recently announced that Best Buy will be carrying their products in all 1,000 + stores nationwide. The company’s competitive advantage is found in their unique ability to customize limitless popular designs such as cell phones, Mp3 players, laptops and GPS devices etc, all the while maintaining very strong gross margins (over 60%). Their brand is catapulting as consumers recognize its popular use for products such as the Apple iPhone and other touch-screen devices. Just after the 3G version was announced last summer, the company had presale orders of 100,000 units which computes to over $1 million in revenue. The rapid growth in 2008 is expected to continue at an advanced rate. Not only did they more than double revenue from 2007 to 2008, but they also expect to see doubling sales year-over-year in 2009 as well. Part of this growth is supported internationally. In fact, international distributors were one of Zagg’s fasted growing segments in 2008. Read more…