CORSAIR CRSR Stock Analysis

Companies / Tech Stocks Jan 02, 2023 - 09:56 PM GMT

Price $18.2.P/E 57, EGF +56%, +27%

Corsair investors have paid the price due to bad company management, poor quality control of products where what one buys does not match the brand image, unfortunately when customers are once bitten they then tend to avoid that brand. On the plus side Corsair has been around for decades and has always had the potential to become something much bigger as we await the advent of Corsair Motherboards and perhaps eventually GPU board partners with the likes of Nvidia. In terms of earnings outlook then there are signs of life as EGF's suggest to expect earnings surprises ahead for both the next quarter and 2023, which is also evident on the stock price chart with most recent price action rising from a bone crushing low of $11 to approaching a doubling to $22 as the stock attempts to break above $18 resistance which would mark the END of Corsairs bear market.

A break above $18 would target a trend to resistance at $22,5 to $24 that is achievable during the current bull run. Expectations beyond that will either take a bid for the $1,75bn corporation or time for earnings to grow. So first a breakout of $18 to mark the end of the bear market and then target the range of $22.5 to $24, and then earnings to grow. It took Corsair about 1.5 years to fall from $35 to $11, it may take a similar amount of time to regain $35 from it's recent low. Another plus is that unlike most such small caps Corsair actually does usually post earnings in 9 out of 10 quarters, nor is Corsair a rampant share printer, though it does print. So whilst the stock has had a rough year, it's not a dead or dying stock, just that the past year has demonstrated that it's management is mediocre at best, they need a CEO who has a vision of what the company could become rather than the same old same old cases and power supplies, though they have tried with NVME2 drives and water coolers just that their efforts of the past 2 years have proved lacking in reliability.

The bottom line is that I have little doubt that we will see $30+ again when I am sure many will with a sigh of relief offload a large portion of their holdings.

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Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

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