ZAGG (Nasdaq: ZAGG) has carved out a cozy living on the back of incompetent gadgetry.

The company -- best known for the invisibleSHIELD thin protective film covering for tablet and smartphone screens -- has been a leader in third-party accessories. Its latest quarter was another beauty. Revenue soared 59%. Profitability surged 80% higher. ZAGG pushed its guidance higher.

However, that can all come to a grinding halt if Apple's (Nasdaq: AAPL) new iPhone is too good.

What happens if Corning (NYSE: GLW) improves Gorilla Glass to the point where customers no longer need to buy screen shields or protective covers? What if Apple raises the bar on accessories, the way it did with its iPad 2 Smart Cover last year?

Sure, things can also go the other way.

The iPhone 5 has a larger display. That's awesome for ZAGG, since the third-party accessories purchased for earlier iPhone models won't fit. There will also be the natural bump in the smartphone migration rate that comes from any prolific rollout, and that's sweet music to ZAGG's ears, because smartphones require investments in cases and accessories that traditional feature phones do not.

There are still plenty of naysayers betting against ZAGG. There were nearly 7.1 million shares sold short as of mid-August. That's the lowest number of shorts ZAGG has seen over the past year, but it's still a big number for a company with just 31.7 million shares outstanding.

Apple certainly has plenty to gain or lose with this afternoon's iPhone 5 rollout, but it's more than likely that ZAGG's stock will be the one that's more volatile after the market assesses the situation.

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