Corsair Gaming is a buy, this analyst says

Roth Capital Partners analyst Sean McGowan says Corsair Gaming’s (Corsair Gaming Stock Quote, Chart, News, Analysts, Financials NASDAQ:CRSR) broader product mix and higher-margin categories should make the business less dependent on chip launch cycles.

In a July 22 report, McGowan initiated coverage of Corsair with a “Buy” rating and $15.00 target.

“We believe the company is undergoing a significant transformation that is expanding its addressable markets, driving steadier and more sustainable revenue growth and higher profit margins,” McGowan said.

Corsair’s results have historically been tied to major CPU and GPU launches from suppliers such as Nvidia. McGowan said those cycles still matter, but management has broadened the product portfolio and reduced the company’s reliance on new chip releases over time.

He said Corsair continues to sell gaming PC components, memory and peripherals, but has been moving away from lower-margin products and leaning into higher-margin categories with larger markets.

That includes Stream Deck from its Elgato subsidiary, which helps streamers and broadcasters produce and distribute content. McGowan said the product supports higher-margin hardware sales and recurring revenue from licensing royalties.

McGowan also sees a potential revenue tailwind in 2027 from the expected PC release of Grand Theft Auto VI, which could drive spending on gaming peripherals such as headsets, keyboards, mice and controllers.

The analyst said Corsair should benefit from greater revenue and earnings visibility as its product mix broadens, direct-to-consumer sales increase and higher-margin revenue becomes a larger part of the business.

“Despite these near-term bumps, we believe that over time, shifts in the company’s revenue mix will be growth steadier and more predictable, as it will be driven more by expanding use cases for its products than by new chip releases,” McGowan said.

McGowan said Corsair ended Q1 with cash roughly equal to long-term debt and should move to a net cash position of about $2.00 per share by the end of 2028.

He said Corsair shares are undervalued. His $15 target assumes the stock trades at just under one times forward 12-month revenue and 12.2 times forward 12-month Adjusted EBITDA by mid-2027.

McGowan expects Corsair to generate Adjusted EBITDA of $109.2-million on revenue of $1.42-billion in fiscal 2026, improving to Adjusted EBITDA of $115.1-million on revenue of $1.52-billion in fiscal 2027.

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