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Skullcandy (SKUL)

  • Thu, Apr. 2, 11:36 AM
    • After meeting with CFO Jason Hodell yesterday, Jefferies has hiked its Skullcandy (NASDAQ:SKUL) target by $3 to $17, while reiterating a Buy.
    • Jefferies: "We continue to view this as the best small-cap idea in consumer discretionary today based on better management, enhanced product & improving fundamentals ... we see opportunity for sales to double from current levels in the medium term."
    • The firm thinks recent numbers reinforce its belief product improvements (both in terms of appearance and specs) are paying off. "We like the [management] remains committed to offering innovative product at disruptive price points & are optimistic for what is in store for 2015, particularly in newer product categories (wireless & gaming)."
    • It also argues: 1) Skullcandy's distribution is now "squeaky clean." 2) Sales growth and better execution can drive op. margin expansion. 3) Further share gains in the sub-$100 segment are possible, as Apple-owned Beats continues focusing on the high-end. 4) Forex and RadioShack's bankruptcy are priced in.
    • Shares are within striking distance of a 52-week high of $11.83.
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  • Tue, Mar. 24, 3:18 PM
    • Today's notable tech gainers include chip packaging/testing firm ChipMOS (IMOS +3.7%), and headphone maker Skullcandy (SKUL +3.9%), mobile banking tech provider Mitek (MITK +6.5%), search toolbar/mobile ad platform provider Perion (PERI +8.8%), Chinese social network/game provider Renren (RENN +4.8%), peripherals giant Logitech (LOGI +4%), security IP licensing firm Finjan (FNJN +13.7%).
    • Notable decliners include e-commerce services firm ChannelAdvisor (ECOM -5.6%), program guide/content protection IP firm Rovi (ROVI -4.3%), telecom equipment vendor Calix (CALX -3.5%), and Fibre Channel/Ehternet switch vendor Brocade (BRCD -3.4%).
    • Likely helping Finjan: An H.C. Wainwright note stating the company has committed $5M to a Jerusalem Venture Partners (JVP) cybersecurity fund; Alibaba announced yesterday it's investing in JVP. Logitech announced a $100 wireless mouse today. Skullcandy is once more within striking distance of a 52-week high of $11.83.
    • Previously covered: Twitter, solar stocks, Sonus/AudioCodes/BroadSoft, Neonode, Arista, Taser, Ciena, Zagg, Gogo, Digital Ally
  • Fri, Mar. 6, 10:50 AM
    • Though it beat Q4 estimates, Skullcandy (SKUL -3.3%) guided on its CC (transcript) for Q1 revenue of $42.6M-$43.4M and EPS of -$0.12 to -$0.14, mostly below a consensus of $43.3M and -$0.08. On the other hand, full-year guidance of $272.6M-$277.5M and $0.36-$0.40 is mostly above a consensus of $259M and $0.37.
    • One-timed items, forex, inventory write-offs, and a short-term air freight issue are expected to have a $0.04 impact on Q1 (and thus full-year) EPS. Forex and RadioShack's bankruptcy will impact full-year sales - RadioShack accounted for over $14M of Skullcandy's 2014 sales.
    • U.S. sales rose 37% Y/Y in Q4 to $70.6M; international sales rose 27% to $26.3M. Gaming headset, Bluetooth headphone, and Wal-Mart demand were key growth drivers. Canada and China drove international growth. Over-ear products were 54% of revenue, in-ear products 40%, and speakers/accessories 6%.
    • In spite of the sales growth, gross margin fell 20 bps Y/Y to 43.3% thanks to higher freight charges and a mix shift towards lower-margin gaming and wireless speaker products; Skullcandy expects a "low 44%" 2015 GM (compares with 2014's 44.6%). SG&A spend was 32.1% of revenue, down from 35.9% a year earlier.
    • High expectations: Going into earnings, shares had risen 25% from the time of Skullcandy's Nov. 5 Q3 beat.
    • Q4 results, PR
  • Fri, Mar. 6, 9:15 AM
  • Thu, Mar. 5, 1:22 PM
    • Headphone/portable speaker maker Skullcandy (SKUL +7.1%) and Chinese social networking, entertainment, and gaming platform YY (YY +4.6%) are both posting big gains ahead of their Q4 reports, which arrive after the bell.
    • Skullcandy is up 25% since posting a Q3 beat on Nov. 5. YY, by contrast, is down 32% since beating Q3 estimates on Nov. 11.
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  • Tue, Jan. 13, 1:24 PM
    • Skullcandy (NASDAQ:SKUL) CEO Hoby Darling and CFO Jason Hodell are presenting at the ICR XChange investor conference. In tandem with the presentation, the company has released slides (.pdf) providing November sales data and initial 2015 guidance.
    • November retail revenue rose 21% Y/Y in a "heavy promotional environment." For the three months ending November, Skullcandy was the top U.S. brand in terms of units moved, and had the #1 and #3 positions in the U.S. earbud and $20-$100 headphone markets (per NPD). For reference, total Q3 revenue growth was 16%, and the Q4 revenue growth consensus is at 13.7%.
    • Skullcandy expects "low teens" 2015 revenue growth (similar to 2014), above a consensus for 9.8% growth. International sales are expected to lead the way. Gross margin (affected by Skullcandy's entrance into new product categories) is forecast to be in the "low 44%" area, and SG&A is expected to equal 38% of revenue.
    • Jefferies upgraded last week.
  • Mon, Jan. 5, 10:16 AM
    • Skullcandy (NASDAQ:SKUL) is kicking off CES week with a bang thanks to a Jefferies upgrade to Buy. The firm's target has been hiked by $2 to $11.
    • The headphone maker is at its highest levels since March. Shares sport a 0.9x 2015E EV/sales ratio.
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  • Nov. 20, 2014, 10:58 AM
    • Skullcandy (NASDAQ:SKUL) CEO Hoby Darling discloses he bought 3K shares on Tuesday at $8.13. CFO Jason Hodell discloses he bought 4.3K shares on Tuesday at $8.12.
    • The purchases come in the wake of Skullcandy's Nov. 5 Q3 beat. Darling and Hodell also bought shares in August.
  • Sep. 17, 2014, 9:53 AM
    • Piper Jaffray's Jonathan Berg assumes coverage with an Overweight rating and $9.50 price target. The firm had been bearish on the stock for most of 2013 and the first part of 2014, before pulling its Underweight rating in June.
    • Skullcandy (SKUL +4.2%) was the recipient of a couple of other sell-side upgrades in August.
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  • Aug. 20, 2014, 9:54 AM
    • D.A. Davidson has upgraded Skullcandy (SKUL +3.9%) to Buy, and raised its target by $2 to $10.
    • The firm thinks Skullcandy's U.S. ops are stabilizing, and is pleased with a mix shift towards higher-margin in-ear headphones.
    • The move comes a week after Jefferies upgraded Skullcandy to Hold, declaring it's seeing "signs of sustained fundamental improvement." Shares are at their highest levels since April.
    | 1 Comment
  • Aug. 12, 2014, 10:02 AM
    • "We are upgrading SKUL to Hold from Underperform as we see signs of sustained fundamental improvement and a cleaner foundation from an inventory, distribution and product perspective," says Jefferies' Randal Konik. At the same time, he still thinks the headphone maker has a long road to recovery, and faces execution risk.
    • Konik's target has been raised by $1 to $8. Skullcandy is less than two weeks removed from soaring in response to a Q2 EPS beat and full-year guidance hike.
    | 1 Comment
  • Aug. 1, 2014, 2:22 PM
    • With a Q2 EPS beat in tow, Skullcandy (NASDAQ:SKUL) is hiking its 2014 EPS guidance range by $0.06 to $0.22-$0.26; that's above a $0.19 consensus.
    • Guidance for mid-to-high single-digit full-year revenue growth is reiterated; consensus is for 7.3% growth. Q3 guidance is for 7%-9% revenue growth and EPS of $0.02-$0.05 vs. a consensus of 7.8% growth and $0.06.
    • Q2 gross margin was 45%, +10 bps Y/Y and above guidance of 44.5%. On the CC (transcript), Skullcandy forecast a Q3 GM of 45%, and has hiked its full-year GM guidance by 20 bps to 44.7%.
    • Also helping Q2 EPS: SG&A spend fell to 43% of revenue from 47% a year ago. However, full-year SG&A guidance is unchanged, due to plans to reinvest the Q2 savings.
    • U.S. sales rose 6% Y/Y to $39.5M, and international sales 6.1% to $14.4M (strong Canadian sales). In-ear headphones made up 56% of revenue (up from 53% a year ago), other headphones 40%, and Bluetooth speakers and accessories 4%.
    • Q2 results, PR
    | 1 Comment
  • Jul. 31, 2014, 4:30 PM
    • Skullcandy (NASDAQ:SKUL): Q2 EPS of $0.06 beats by $0.05.
    • Revenue of $53.9M (+6.1% Y/Y) in-line.
    • Shares +1.3%.
    • Press Release
  • Jun. 11, 2014, 10:53 AM
    • Citing confidence in Skullcandy's (SKUL +3.1%) new headphone lineup, Piper has upgraded shares to Neutral. Its PT is at $7.50.
    • SA author Charles Moscoe has been more critical of Skullcandy's product line, noting margins have come under pressure thanks to tough competition and high channel inventories. The company's North American sales (+1.3% Y/Y in Q1) remain soft, but its international sales (+19.7%) are faring better.
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  • May. 9, 2014, 10:20 AM
    • A report that Apple is set to acquire Beats Electronics for $3.2B is providing a lift to fellow headphone maker Skullcandy (SKUL +6%).
    • Skullcandy's current market cap of $201.7M is a small fraction of Beats' reported acquisition price. The company's U.S. sales have been slumping due to tough competition from Beats and others, but international sales have been faring better.
    • Shares rallied last week following a Q1 EPS beat and healthy guidance, but quickly gave back their gains.
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  • May. 5, 2014, 12:04 PM
    • Though the company beat EPS estimates, Skullcandy's (SKUL -6%) Q1 report suggests its "core brands sales are in significant domestic decline," writes Charles Moscoe in a Friday evening SA column.
    • With U.S. sales still under pressure, Moscoe doubts the 200 bps Y/Y gross margin improvement delivered in Q1 is sustainable. He also asserts Skullcandy has only been able to maintain minimum advertised pricing for two products - Crusher and Air Raid - following many quarters of channel-stuffing.
    • Nonetheless, though Moscoe considers Skullcandy shares "overpriced by a significant margin," he thinks much better shorting opportunities exist.
    • Meanwhile, in a column released shortly before Friday's close, Stan Ackman notes international gross margin fell 320 bps Y/Y to 44.9%, even as North American GM rose 350 bps to 47%. He also expresses doubts about the impact of Skullcandy's Wal-Mart deal, given a lack of detail from management.
    • Shares have fully given back the Friday gains they saw in response to Skullcandy's EPS beat and solid guidance.
    | 1 Comment
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Company Description
Skullcandy Inc designs, markets and distributes audio and gaming headphones, earbuds, speakers and other accessories under the Skullcandy, Astro Gaming and 2XL brands. The Company operates through its Domestic and International segment.