The earthquake in Japan might cause growth to moderate. Key semiconductor factories were put out of commission. And the nation's electricity supply could be constrained for months as the nuclear power plants in Japan are recertified, or rebuilt. Zagg's tablet related volume also might be effected by Apple Computer's new iPad cover. That's not a direct competitor but many consumers might be reluctant to buy a second accessory. Still, another powerful performance appears likely. We estimate sales will improve 25%-31% to $95-$100 million to provide earnings of $.55-$.60 a share (+28%-40%). Expanding smartphone and tablet demand combined with new product introductions are capable of propelling sales to $150-$175 million within 2-3 years. Income could achieve $.75-$1.00 a share.
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