Zagg: A Cheap Cash Cow Without A Moat (NASDAQ:ZAGG)

Zagg (ZAGG), is a micro-cap retailer of phone cases and accessories, that has carried long-standing relationships with major phone OEMs such as Apple (AAPL) and Samsung (OTC:SSNLF). The company generated significant cash flows in the trailing 12 months and had previously been in the sights of PE firms. Despite that, the stock is down ~63% YTD. The company’s balance sheet and cost-cutting measures will ensure they can survive this pandemic, and cash flows should return. Zagg’s extreme lack of moat and pricing competition from Chinese manufacturers, however, makes a long-term investment in this company challenging.

Zagg’s product lines and lack of moat

Zagg labels itself as a leader (by market share) in the mobile power bank, screen protection, and wireless charging pads.

Source: Zagg September 2020 Investor Deck

Zagg sells these products in Apple Stores, international carriers such as AT&T (T), and Verizon, as well as online via its online

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