the bottom line with zagg is that they look to be squeezed by better competitors on every side. logitech stole the tablet keyboard market. skull is grabbing more share in the audio space. and what is the future of the shield market? it looks to me like sapphire covered iphones will reduce the need for screen protection. the cuts in expenses are all used up, so in order to grow profits, they need to grow revenues. but with better competitors on all sides, where do they grow? seems like hales threw his last "hail mary" with the stock buy-back, but as it runs out, the market will determine that it is a failure. if zagg has some hot new products up their sleeves for the end of year, then i will be dead wrong. but past experience says they will hale (fail) again.
two very divergent pieces of information. consumer surveys show that the 5S has maintained consumer purchase intent, however, sales of apple suppliers looked very poor in february, down more than previous year. i think the supplier news is more accurate for predicting the next quarter, so will stay away from apple stock for a little while longer.
maybe hales is using the buy-back to pump the stock up. i still cant imagine that they can turn it around. how do they sell screen protectors when apple introduces sapphire screens? and can they compete with logitech in keyboards? i dont have any inside info, so i'm just guessing, but seems like there are alot of people holding zagg with big losses and they are going to be selling as it moves back up.
so far, it is looking like zagg is not going to hold any momentum. i would guess the stock continues to trade down under 4. the long-term viability of the company is in jeopardy if apple introduces sapphire covered screens and consumers dont feel they need a cover any longer.
sure, like your threat to arizona over that bill. cook, maybe you need to focus shareholder resources on the company, not fighting personal battles.
let's look at what happened last time they bought back shares - that was about a year ago, and soon after hales bought millions of dollars of stock, the price collapsed due to missed earnings.
you have to wonder if zagg can even hit the lowered guidance it gave out. tablet sales were scorching during the holidays, yet zagg's sales still fell. this year apple will introduce sapphire screens, once again that diminishes the need for a screen saver, or at least for an expensive one. and i see more patents from apple on motion technology that could eventually wreck havoc on the keyboard market for tablets.
overall, i think the only reason zagg share price is not lower is that they are buying stock, but that cash will run out and then the price will revert to the valuation expectations.
look at the difference with what the new logitech ceo did. he replaced most of the top managers who were in charge of product lines. took about a year and a half to turn around that ship. look at what hales did with the sales issue. he demoted the top sales guy, but kept him at the company. i guess now they are finally getting a new head of sales. they also need a new head of marketing/ product management.
last year the company executed a stock buy-back in feb, right before announcing bad earnings and the stock price crashing. it is my thesis that tablets sold boatloads during last quarter and iphones were also selling well, so zagg should have been doing great. since they were not, i believe the coming quarter will be even worse than management has stated. it looks to me like hales is once again trying to buy stock to let some shareholders escape right before another crash. hales interests are 100% un-aligned with shareholders.
hales has been "addressing the problem" for 2 years now, first as coo and then as ceo. the problem is hales. hales had been talking about all the things they are doing for those 2 years, but the revenues keep falling and the profits keep falling. yes, plenty of companies waste their money on marketing consultants. if zagg doesnt have a head of marketing who can figure out a strategy, then why dont they fire and hire a new marketing head? consultants are salespeople first, selling the notion that they know something you dont. if the consultants know more about zagg's market than zagg, then that is a huge problem.
article stating that institutional ownership of the stock has fallen to lows of 30%. this explains why the stock cant rise, even with apple buying $14 billion in shares. the big institutions just keep hitting the sell button and selling down their massive holdings. apple needs to see strength in iphone sales to stop this selling, so the sooner the iphone 6 is released the better. i think the big institutions tend to just follow the latest wall street thinking, so when that thinking changes, the stock price should rebound rapidly. but that will require apple to PROVE iphone sales are not tapped out.
the fact that apple has to support the stock price with repurchases is a negative in my opinion. the market just does not think very much of apple at this point.
isnt that one of the worst signs ever - they hired a consultant to give them a strategy because NOONE in this company has a CLUE!!!!!
consultants make absurd strategies that look good in presentations, but they never amount to a hill of beans. anyone can come up with smart-sounding strategies, it is the execution that is difficult.
and my final criticism of this decision is that customers dont buy strategies or even brands, they buy products. ask elon musk, who says that the tesla brand is an outcome of the great products, not the other way around.
hales must have read a management book somewhere and thought he could manage a company!
hales made lots of promises for the future in past year. never lived up to a single one. why would anyone trust him? i learned that when a ceo comes in and pays himself a fat salary and take little of his compensation linked to the stock price, he probably knows he is going to tank the stock. hales has had a year to deliver on any of his promises.
actually, they were smart to hold off on mobile gaming. it just isnt ripe yet, needs software titles to get going. probably will be a good place when the larger screen iphone 6 emerges.
they still have $40 million intangibles on the books and probably need to write that off completely.
ok, so another miserable quarter for zagg. here is the comparison - zagg's keyboard sales lost year over year, while logitech tablet keyboards gained almost 100% year over year. given that the tablet market grew rapidly, how does zagg's management explain this, other than to say that they are simply non-competitive?
logitech has keyboards in apple stores. zagg does not. the attach rate on ipads for keyboards is MUCH higher than for other tablets. so why does zagg think it is such a good idea to focus on keyboards for the other tablets? (answer: they cant compete on sales for ipad keyboards).
additionally, zagg is projecting that shield sales will resume growth in second half of the year. isnt that the timing of when apple is rumored to introduce new iphones with sapphire covering the whole screen - thereby reducing the need for scratch protection?
i think the morning spike was simply zagg holding the price up with buyback money, but it failed. they can't fight mr market long-term. so zagg might rise a little if they aggressively buyback stock, but it will run out and the price will revert to a true valuation - sub 4.00.
i keep thinking that logitech will enter the smartphone accessory market in a bigger way and that will be the final blow for zagg. apple introducing a sapphire screen could also be the crushing final blow.
wish i had seen that zagg spike this morning, it would have been a good time to sell it.
i read the ericson report on the mobile market. when you look at the growth and size of international markets compared to the US, you realize how absurd the apple strategy is. apple has negligible market share in many international markets. apple needs products that will appeal to a larger base of customers. i will still get into apple pre-iphone 6, but apple's stock should be moving up leaps and bounds, instead we get cook who is more interested in #$%$ rights than the shareholders. apple - love the company, hate the ceo.
wrong. the whole problem with apple is the ceo. he is the guy who needs to be removed.
the break-down of international versus domestic growth and monetization of that traffic tells the story. international maus grew 33% year over year, while domestic grew 21%. but here is the problem. international revenues are only .60 per 1000 mau vs. $3.80 for domestic. so the only way for twitter to grow is to better monetize the international maus, but it is very likely that those maus are simply lower value because the consumer benefit to advertisers is much less.
so to me, the most important metric on twitter is whether they can increase the monetization of international maus. if not, then the growth in the US is almost totally gone.
i give them one more good quarter, due to the olympics, after that, the growth is tapped out.