NEW YORK ( TheStreet) -- While Wall Street may not come to mind as a typical customer for Skullcandy, ( SKUL) whose fashion-forward headphones in gold foil and rhinestones are prized by snowboarders and skaters, think again.

Six investment banks that worked on the Utah-based company's July IPO initiated coverage Monday with buy ratings, including Bank of America/Merrill Lynch, Morgan Stanley and Raymond James.

Skullcandy, which has grown to become the second-largest headphone maker in the U.S. behind Sony ( SNE) after nine years in business, is poised to capitalize on the rise of Apple ( AAPL - Get Report) products like the iPod and iPhone, analysts said.

"We view the secular trend of music portability ... as the key driver in Skullcandy's growth," KeyBanc analyst Edward Yruma wrote in note to clients.

Skullcandy continued to grow in the second quarter, reporting revenue earlier this month of $52.5 million, up 46% year-over-year.

Yet some analysts say that just like the rise of Groupon clones hoping to capitalize on the success of the Chicago-based daily deals market leader, there's concern that too many companies -- Skullcandy included -- may be trying to ride Apple's coattails.

Investor enthusiasm for products swirling inside the mobile ecosystem has contributed to increased competition, and Skullcandy must battle with bigger rivals like Nike ( NKE) and other lifestyle companies like Beats by Dr. Dre, which HTC recently acquired a majority stake in for $300 million.

"There are zero barriers to entry and it's not a complicated, high technology product that requires patents," said Scott Sweet, senior managing partner with IPO Boutique.

Another potential hurdle for Skullcandy: danger of over-exposure.

While Skullcandy is a so-called cult brand endorsed by rappers like Snoop Dogg and Jay-Z and is targeted at a relatively small group of passionate users -- namely 18-25 year olds -- there's concern that its image could be hurt by becoming too mainstream.

"Authenticity sometimes suffers from over-exposure and if the brand gets too commercial too quickly it could lose some of that," said Avi Greengart, a consumer devices analyst with Current Analysis.

Shares of Skullcandy, which have fallen over 20% since the company's public debut, edged up 2.9% to $15.94 in afternoon trading on Monday.

--Written by Olivia Oran in New York.

>To follow the writer on Twitter, go to

>To submit a news tip, send an email to: