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Skullcandy, Inc. Message Board

  • ggrail ggrail Nov 1, 2012 5:16 PM Flag

    Q3 Conf Call

    I'm long the stock in the area of 10-12k shares. I do not short the stock nor lend it.

    Presentation skills of both parties on call poor. Andrus somewhat better than Kyle who iwas a disaster wrto presentation. ""A defendable story" the hell is that about Skippy?

    While they seem to know the business relying on them to convince investors does not play well.

    They are staking a lot on Astro and played the weather card of which the latter is lame. 2XL brand growing great but those margins are smaller.

    China break even by year end Europe an anchor round the neck at present.

    Not as sure about this one long term as I was before, as their skills in convincing me, who already owns the stock, did not leave me with the warm fuzzies. They seemed disorganized mentally and unprepared to cogently communicate their message.

    Andrus weak in the Q&A, his extemporaneous speaking skills not up to CEO par, imo.

    In short they do a good job hiring front end spokespeople for their brand they need to hire someone that can walk chew gum and present at the same time or at least read without stuttering. Head office needs to remember that they are the spokespersons and front end to the investment community.

    All that negativity aside. Made their numbers for the Q backed off for the future which was good news for shorts bad news for me.

    May hang on with half a load but they need to get their Utah #$%$ in gear and get organized because the call sounded like they were smokin rope instead of selling ear buds.

    Keep Kyle off the calls get Andrus some happy juice instead of Xanax and talk about what you're going to say before you go live.

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    • i'm not trying to bash but for a company with so much potential they need to get real.

      Managment has no idea what they are doing, especially outside North America. Every quarter it's same old #$%$ , they can't control opex, they can't control inventory, they've got the wrong product lineup. etc etc

      Growth is now slowing, forecasts are lowering whilst the overall Category is doing well. They are loosing to competitors. they're in a commodity product category, margins will be lower and more competitor enter the market every month.

      it's going down hard tommorrow. I've traded in and out of it but i think i've finished following it, it's got nothing going for it now.

      • 2 Replies to staffordo3
      • I told you so thread 1.

        Sentiment: Strong Sell

      • I feel some of your frustrations (share price and some of their earnings call comments). I think it could drop short term, but I see no reason for it to stay down long term and should trend up.

        I actually think management knows this business and I like their business model. I think they're making great progress with brand recognition and that will pay off long term. However you view things, they're still growing and gaining strength.They will fight off their competitors as they're facing the same stiff competition; only a few of the strong will survive and Skull is investing up front to ensure a long term quality brand.Eventually the weaker players will drop out as they won't have the brand and cash to hang around.

    • Agree with your conf call thoughts. I conclude they are better businessmen then executive communicators. As an investor I'm ok with that as long as they deliver EPS and growth. I think they are positioned well for growth. In my opinion they still seem to spend alot of money, but maybe that's what it takes in this business. $23 mil of G&A for the quarter seems high. Just reducing that by $1mil would bump the EPS by 4 cents; seems like they could trim some fat or reduced stock comp.

      My complaint is with the amount of stock based compensation they pay themselves. $5.1 mil for nine months; I would like to think this would be somehow linked to the stock price performance. This comp continues to increase the number of outstanding shares.

    • gg

      Thanks for the synopsis. I am on the road today so I couldn't listen in (I'll listen to it tomorrow). What did they do to Andrus? He was fairly articulate on the q2 call and defiantly defended the stock.

      Sentiment: Strong Buy

    • I will tell you one big positive of the call. All this nonsense about competition from Beats by Dre was dispelled. Also there are positive long term trends in terms of profitability with regards to lower taxation. Growth in gaming is exceeding expectations and the guidance is 'very conservative' and several catalysts remain. As the brand is in its infancy, margins will continue to be pressured but this will be alleviated over time.The 'trader' in me tells me that this will surprise everyone and move up sharply now that expectations have been lowered. Wall Street works in funny ways.

      • 1 Reply to charlesmoscoe
      • Charlie- hope you are right. Gaming is a big deal but cannot exist without the rest of the mix contributing and it is in it's infancy. The brand is relatively new and that is a net positive. One of the things that attracted me to the stock.

        I feel they need to fine tune their presentation skills. Being the old guy I thought Kyle would be sharper. Maybe they were just ill prepared. Will not totally divest here but they need to turn it up a notch or wallow in the short trader sights forever.

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