i'm waiting for 2013. should be very interesting to see how zagg performs once the shorts have finished covering and the money managers have finished selling zagg for tax losses. as far as timing, my guess is that zagg will fall back into the 6's one more time, and the bottom will be between now and christmas. if zagg doesnt climb before the next earnings release, then i will be shocked and proven wrong, but that is the timing I'm sticking with.
The question is what is the game plan of the shorts? Clearly, they have been in no great hurry to cover while knocking the pps down some 30-40%. As of the last published report less than 5% of the short interest has been covered. Investors go short or long for profit. Are the shorts simply stuck unless they can create a panic and cover while driving the price down further?
first, some short positions need to be held until after the 1 year anniversary of the plunge last year, so the price is being held down. second, the shorts are counting on end of year selling where investors want to sell zagg to realize a loss that offsets a gain in other stocks. they also know that end of year some fund managers and money managers will sell zagg so they dont have to have it on their list of holdings - since it has been a loser stock. so the savvy short sellers will be using the next month to cover as much as possible. i dont think there will be any hedge funds that will want to add to positions heavily until end of year, but in early january, there might be some smart hedge funds that decide that they can afford to simply run a squeeze on the short sellers and that Q4 earnings report will support a much higher price to squeeze shorts even further. look at how zagg rose right from the beginning of last year, and the shorts were not even covering at that time. the reason that shorts didnt cover last year is that they knew about the pederson margin issue. there are still some analyst targets at the $20 range, that is a triple from the mid 6's.
2013 should start showing income from the HZO investment and I think that will get huge eventually. I have seen a ZAGG ad on "Warrock"; a first person war/zombie shooter game I play. However, I do think there will be a market crash like in 2009 because of abummer's re-election.
Not sure how that will affect ZAGG, but with a P/E of 9.2, not much lower. I hope they made a lot of product for this Christmas season because those accessories make great gifts. Blowout earnings if they can keep the shelves stocked.