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[abh3vt]

Limited public details of the SKUL downgrade, but here is what I found doing a quick google search:

Jefferies downgraded Skullcandy (NASDAQ: SKUL) from Buy to Underperform and slashes its price target from $17 to $6 citing a lack of pricing power and increasing competition.

"The in-ear headphones which comprise over 60% of SKUL's revenues are under significant pressure from a variety of competitors, and we believe this trend will likely continue in coming quarters," the analyst comments. "And though SKUL is diversifying into more on-ear and over-ear headphones, these growth categories inherently carry lower margins."

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I did not see an earnings change, but the eps numbers for FY12 and FY13 have been falling steadily over the past quarter:
http://finance.yahoo.com/q/ae?s=skul&ql=1

I'm guessing that the $6 price target assumes a drop in earnings next year. Looking on the bright side, at least the bar is being set very low for SKUL next year and that can often fuel "beats" that drive trader interest.