1-Star Stocks Poised to Plunge: ZAGG?

Brian D. Pacampara, The Motley Fool
Updated

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, handheld device accessory specialist ZAGG (NAS: ZAGG) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at ZAGG's business and see what CAPS investors are saying about the stock right now.

ZAGGfacts

Headquarters

Salt Lake City, Utah

Market Cap

$311.2 million

Industry

Consumer electronics

Trailing-12-Month Revenue

$179.1 million

Management

Founder/Chairman/CEO Robert Pedersen
CFO Brandon O'Brien

Return on Equity (average, past 3 years)

34.3%

Cash/Debt

$26.4 million / $68.3 million

Competitors

Apple
Forward Industries
Motorola Mobility Holdings

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 35% of the 332 members who have rated ZAGG believe the stock will underperform the S&P 500 going forward.

Earlier this week, one of those Fools, All-Star kkconway, succinctly summed up the bear case for our community:

Lousy moat in an easily entered market. Great earnings won't hold up many more quarters. If they are in Wal-Mart, they'd better have a long exclusive contract, but that's not gonna happen!

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At the time thisarticle was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Apple and Wal-Mart. Motley Fool newsletter services have recommended buying shares of Apple and Wal-Mart, as well as creating a bull call spread position in Apple, creating a diagonal call position in Wal-Mart, and writing naked calls on ZAGG. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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