Market Overview

Skullcandy a Buy on Headphone Demand?

Shares of Skullcandy (NASDAQ: SKUL) are down over 30 percent this year, and over 50 percent since initially opening for trading in the summer of 2011. Yet, with demand for its products appearing to grow, will shares finally turn around?

Skullcandy is a maker of headphones. The company is notable as the only (primarily) headphone company trading on a major U.S. exchange. Most of the other headphone manufacturers are divisions of a larger electronics firm -- Sony (NYSE: SNE) and Apple (NASDAQ: AAPL), for example.

Skullcandy is one of the most popular stocks for short sellers to target, with a short float near 42 percent.

MarketWatch, citing a report from NPD, notes that demand for high-end head headphones is accelerating. As more consumers adopt mobile devices like smartphones and tablets, the broader demand for headphones is increasing.

That could benefit Skullcandy, although most of the company's offerings are earbud headphones in the lower-to-middle end segment.

Shares of Skullcandy traded lower on Monday, down over 2.50 percent in early trading.

Posted-In: Long Ideas News Trading Ideas Best of Benzinga

 

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